Bermuda-based Enstar Group Ltd yesterday said it had agreed to buy Clarendon National Insurance Co from Hannover Re for $200 million.The company, which specialises in acquiring and managing businesses that are being run off, said in a statement the deal would be financed through a bank-loan facility and cash.Insurers go into “run-off” when thet stop writing new business. Enstar acquires such companies and manages their loss reserves and their remaining obligations, including claims from policyholders.Enstar has achieved impressive growth in recent years and continued to expand through the financial crisis. By the end of September, the company had total assets of more than $5 billion and shareholders' equity of $883.2 million.Hannover Re said yesterday that the sale includes all the operational companies of Clarendon Insurance Group and allows the German giant “to free itself from the operational risks associated with the run-off of a US insurer”.Hannover Re, the world's third-biggest reinsurer, bought US specialty insurer Clarendon in 1998 as it sought to reduce its dependency on property and casualty reinsurance, where earnings can be more volatile. The company sold most of its specialty insurance business to Australia's QBE Insurance Group Ltd. for $800 million in December 2006.As the selling price is equivalent to about 80 percent of the statutory equity of Clarendon, Hannover Re expects to book a charge in the “mid-double-digit million-euro range” this year, it said. The company reiterated its target to post a profit in 2010 of more than 700 million euros ($918 million).Specialty insurance includes art insurance, health insurance for pets and policies for high-risk drivers.The transaction, on which JP Morgan Securities acted as the exclusive financial adviser to Hannover Re, is expected to close in the second quarter of 2011, both parties said.