Munich Re Group has finalised the acquisition of NEXT Insurance, integrating it into the management structure of ERGO Group AG, its major primary insurance business.

The transaction, announced earlier in the year, was completed with the companies successfully meeting all conditions, obtaining the necessary regulatory approvals, as scheduled.

This acquisition marks ERGO’s entry to the US, the world’s largest insurance market, tapping the attractive US small and medium-sized businesses (SMB) segment.

Small businesses represent 99% of all companies and contribute 44% of gross domestic product (GDP) in the US, a staggering 75% are underinsured, despite a $175 billion total addressable market.

This significant gap presents substantial growth opportunities, which Munich Re aims to seize with this strategic acquisition.

NEXT Insurance is a technology-first Property & Casualty insurer focusing on the US small business owners, founded in 2016 and headquartered in Palo Alto, California,

It offers simple, digital insurance coverage, including General Liability and Workers’ Compensation.

NEXT Insurance’s proprietary technology stack and its fully digital, automated underwriting/pricing platform will complement ERGO’s business capabilities.

In turn, ERGO will leverage its technical excellence and insurance know-how to foster NEXT Insurance’s business growth.

Markus Rieß, Chief Executive Officer of ERGO Group AG, said: “Today’s transaction closing represents an important milestone in establishing ourselves as a relevant insurance provider in the USA. Together with NEXT Insurance, we will seize the considerable growth potential offered by this attractive market as we expand our existing business portfolio.

“Through the combination of NEXT Insurance’s technologically driven, successful market approach and ERGO’s insurance expertise, we will deliver profitable growth and added value for all our stakeholders.”

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