A BAT spokeswoman said the deal would have no material impact on Farmers' trading profits and would allow the group's sales force to concentrate on the third of its life companies, New World Life Insurance, which is a much bigger operation. "It's housekeeping really. It's something we have been saying we have been going to dispose of for some time," she said.
Ohio State and Investors Guaranty sell a variety of life insurance throughout the country and abroad, using independent managing general agents and independent marketing organisations. The deal means Americo will have roughly 1 million live policies and more than $3.3bn assets under management.
BAT's shares dipped 6p to 495.5p yesterday.