Travelers to sell Canadian personal & most of commercial arm to Definity Financial

Property and casualty insurer, The Travelers Companies, Inc., has agreed to sell the personal insurance business and the majority of the commercial insurance business of Travelers Canada to Canadian property and casualty insurer Definity Financial Corporation for approximately $2.4 billion.

The transaction is expected to close in the first quarter of 2026, subject to regulatory approvals and other customary closing conditions.

Travelers explained that the purchase price represents a multiple of 1.8 times book value, adjusting for approximately $0.8 billion of excess local capital, which is being repatriated as part of this transaction in a tax-efficient manner.

As per the details, Travelers, the largest surety writer in North America, will retain its Canadian surety business.

The insurer expects to use approximately $0.7 billion of the net cash proceeds from the transaction for additional share repurchases in 2026. While the rest will be retained for supporting ongoing operations and for general corporate purposes.

The transaction and resulting share repurchases are expected to be slightly accretive to the company’s earnings per share in each of the next several years.

Alan Schnitzer, Chairman and Chief Executive Officer of Travelers, commented, “This transaction is a reflection of our steadfast commitment to disciplined capital allocation and long-term value creation.

“The evolution of the Canadian market over the past decade has made Definity a natural long-term owner for this business, a view affirmed by the compelling value of their proposal. I am confident that our Canadian customers, brokers and colleagues will benefit from being part of one of the country’s leading and fully integrated property casualty insurers.”

Jefferies LLC acted as financial advisor, and Skadden, Arps, Slate, Meagher & Flom LLP and Stikeman Elliott LLP served as legal advisors to Travelers.