FRANKFURT, Oct 30 (Reuters) - Munich Re’s primary insurance arm Ergo is forging ahead with plans to sell the life insurance books of units Ergo Leben and Victoria Leben, Handelsblatt daily reported on Monday, citing two people familiar with the matter.
“Management wants to collect non-binding bids in mid-November,” the paper quoted the sources as saying.
Ergo will decide based on those indicative offers whether to start negotiations to sell the roughly 6 million insurance policies, it said.
A spokeswoman for Ergo declined to comment on the report.
Ergo had said in September that it was considering options for the two life insurance units, which have ceased underwriting new business.
Ergo and fellow insurers are struggling to pay guaranteed returns to clients because of record-low interest rates. Combined with more stringent European capital rules, these have prompted some to offload life insurance operations.
Financial services groups specialising in the run-off of life insurance are vying for these portfolios. They acquire policies until their expiry and aim to turn a profit by measures such as cutting administrative costs. (Reporting by Kathrin Jones; Writing by Maria Sheahan; Editing by Gopakumar Warrier)