Reinsurers PartnerRe and Axis Capital Holdings have agreed to an $11bn merger that will create one of the world's largest reinsurers.
The combined entity will have gross premiums exceeding $10bn (£6.66bn, €8.92bn), a total capital of over $14bn, and cash and invested assets of more than $33bn, the Bermuda-based firms said in a statement.
Reinsurance is insurance purchased by an insurance company. It helps insurers spread risk and settle large damage claims.
"The merger of equals has been unanimously approved by the boards of directors of both companies, and brings together market-leading insurance and reinsurance franchises that will benefit from increased scale and enhanced market presence.
"The merger is expected to achieve at least $200m [£133m, €179m] in annual pre-tax cost synergies in the first 18 months of operations and to be accretive to EPS and ROE for the shareholders of both companies.
"The transaction is expected to close in the second half of 2015, subject to approval by the shareholders of both companies, regulatory clearance and customary closing conditions," it added.
The deal is the latest instance of consolidation in the reinsurance sector, which has been battling shrinking premiums and tough competition.
Earlier in the month, Dublin-based XL Group agreed to buy rival Catlin Group in a deal valued at £2.79bn.
Last November, Bermuda-based RenaissanceRe Holdings agreed to buy Platinum Underwriters Holdings for over $1.9bn.