| LONDON, March 18
LONDON, March 18 British insurance entrepreneur
Clive Cowdery is looking to Europe and the United States as
markets where he can replicate his model of mopping up life
assurers as he stepped down from the UK-focused Resolution
vehicle he founded.
Speaking to Reuters after announcing a U.S. Resolution Life
vehicle with a $2 billion war chest on the brink of completing
its first acquisition, Cowdery said he already has teams on the
ground in Europe.
Cowdery's business model involves buying up life insurance
companies that were usually closed to new clients and merging
them to make tax and operational savings.
These funds pay out to pensioners and over time their
liabilities reduce so the amount of capital they need to hold
also drops, freeing up cash that can be returned to investors.
His Resolution venture in Britain said on Tuesday it
was to drop the name, associated with Cowdery's buying sprees,
and apply its Friends Life brand to the listed entity.
Cowdery is stepping down from the board to pursue his
"The UK market is consolidated, it's done," he said, noting
that his ventures had snapped up around a third of the British
market over 10 years.
His Resolution Group holding company said on Tuesday its
U.S. venture Resolution Life, set up last year, is about to
close its first deal, buying Nebraska domiciled Lincoln Benefit
Life from Allstate Corporation for around $600 million.
The United States, like the UK before it, has too many
insurance companies, he said, with around 940 owned by around
400 holding companies.
"It's a big country, but I think that's overdoing it," he
Cowdery also expects the $2 billion the United States to
fund the first three acquisitions and he plans a share listing
there to raise more.
"Two billion in a country the size of America is really just
a way to get going. At some point we'll go public as a way of
raising even more," he said.
At the same time, he has teams in Europe setting up a
similar venture, most likely to be headquartered in London,
intending to seize the opportunity to consolidate across borders
created by the introduction of a common European capital
standard for insurers.
The European Union is introducing a set of capital rules
dictating how much money insurers must hold against their risks,
known as Solvency II, from 2016.
This, Cowdery believes, will impose capital requirements
that may prove too onerous for some small insurers to operate
But the fact that a single standard will operate across the
entire bloc makes a continent-wide consolidation viable for the
"Capital rules until today have been different in each
country and therefore you could never really get critical mass,"
he said, adding that he could start raising money from investors
for the venture "towards the end of this year."