The Travelers Companies Inc. (NYSE: TRV) has agreed to acquire The Dominion of Canada General Insurance Co. from E-L Financial Corp. Limited (TSX: ELF) for approximately $1.1 billion in cash, subject to adjustment.

The announcement said that The Dominion and Travelers’ Canadian operations will be integrated and the combined organization will remain headquartered in Toronto.

The Dominion is one of Canada’s largest auto, home and business insurers. The company distributes exclusively through independent brokers.

“This transaction is consistent with our strategy to make thoughtful investments in attractive markets outside the United States,” said Jay Fishman, chairman and CEO of Travelers.

He said the transaction should have no significant impact on 2013 earnings per share and will be slightly accretive to 2014 earnings per share.

Brigid Murphy, president and CEO of The Dominion, will continue in these roles at the combined organization. George Petropoulos, president and CEO Travelers Canada, will help Murphy lead the new organization as vice chairman. In addition, Petropoulos will be executive vice president, Bond and Financial Products.

The Dominion reported that for the year 2012, net income was $65.5 million compared to $25.2 million in 2011. The increase was mainly due to the realized gain on the sale of The Dominion’s head office property, better underwriting results and higher net realized investment gains. The combined ratio was 107.0 for 2012 compared to 108.3 for 2011.

Travelers cited the firm’s independent broker network as a strength. “The Dominion’s extensive distribution network and established customer base provide us with an exceptional platform for expanding our commercial lines business and generally strengthening our presence in Canada,” said Alan Schnitzer, vice chairman and head of Travelers’ Financial, Professional & International Insurance business segment.

The transaction is expected to close in the fourth quarter of 2013, subject to regulatory approvals and other customary closing conditions. Travelers said it will fund the transaction, subject to market conditions,through a combination of debt and/or preferred stock financing and internal resources. Based on this financing plan, the company does not believe that the transaction will have a significant impact on anticipated share repurchases for 2013 or 2014.

Skadden, Arps, Slate, Meagher & Flom LLP and Gowling Lafleur Henderson LLP served as legal advisors to Travelers.