Ace has agreed to acquire all the outstanding common stock of Rain and Hail Insurance Service for around $1.1bn in cash.

Headquartered in Johnston, Iowa, Rain and Hail is the a crop insurance underwriter, providing multiple peril crop and crop-hail insurance protection to customers in the US and Canada.

Ace, which currently owns around 20% of outstanding common stock of Rain and Hail, said Rain and Hail will continue to operate as a separate and distinct franchise within its Westchester division and Insurance-North America operations.

Ace chairman and CEO Evan Greenberg said that the addition of Rain and Hail to the company is financially attractive to its shareholders and will produce results that are immediately accretive to its earnings, return on equity and book value per share.

The transaction is expected to be completed by the end of 2010, subject to regulatory approvals.