American National Insurance Acquisition Catalyzes Brookfield Reinsurance’s Ascent

In 2022, Brookfield Reinsurance acquired American National Insurance in a $5.1 billion all-cash agreement. This deal has proven instrumental in propelling Brookfield’s rapid growth across various insurance sectors over the past two years. Leveraging American National’s over 100 years of established operations and portfolio encompassing life insurance, annuities, and property and casualty products has enabled Brookfield Reinsurance to expand its geographical reach, service diversity, and assets under management.

Initially focused predominantly on reinsurance when founded in 2020, Brookfield Reinsurance has since evolved its business model. By acquiring insurers like American National, Argo, and AEL, Brookfield provides direct insurance and pension risk transfer capabilities alongside its reinsurance solutions. This acquisition-driven strategy aims to foster growth both organically within acquired firms’ existing operations and inorganically through continued expansion into new insurance markets.

The American National deal, in particular, allowed Brookfield Reinsurance to immediately extend its footprint across all 50 US states while augmenting its offering across additional insurance lines. Brookfield’s CEO Sachin Shah emphasized at the time how American National’s stable growth track record and disciplined underwriting approach made them an ideal partner for the next growth phase. The deal expanded Brookfield’s direct insurance abilities and laid the foundation for subsequent P&C and annuities acquisitions.

On the back of the American National integration, Brookfield continued expanding aggressively, deploying over $10 billion in capital into key deals since late 2022. This includes November 2023’s $1.1 billion acquisition of Argo Group, further enhancing Brookfield’s presence in US P&C insurance. The impending $4.3 billion purchase of annuities specialist AEL, set to finalize in 2024, will also position Brookfield firmly in the retirement solutions.

As Brookfield Reinsurance strategically integrates these acquired insurance firms, the company is projected to surpass $100 billion in managed assets imminently in 2024. Each deal compounds the breadth of Brookfield’s insurance offerings, aiming to capitalize on the distinct strengths of each firm to optimize returns for policyholders and shareholders. Tying into parent company Brookfield Asset Management also opens up enhanced investment opportunities to drive yields.

Fundamentally, Brookfield Reinsurance views insurance companies as long-term holdings to nurture over time rather than quick assets to flip. The strategy emphasizes utilizing strong existing leadership and operations while exploring avenues to expand amidst an adapting insurance landscape organically. Shah summarizes that as assets balloon toward $100 billion, the focus remains on scaling core businesses, managing risk, and maximizing investments to continue driving returns.

With American National recently being recognized by Forbes as one of America’s top insurers for service and satisfaction, the 2022 deal to bring this 100+ year franchise under Brookfield Reinsurance’s wing has already proven dividends. Its impact catapulting Brookfield’s growth trajectory steeply upward in a few short years highlights the acquisition’s significance. As Brookfield Reinsurance maintains this aggressive expansion approach, its ascent amongst top global insurers seems poised to continue gathering momentum.