Munich - The giant German insurer Munich Re said Monday it had agreed to pay 742 million dollars to buy a US insurance offshoot of the American International Group (AIG) Inc, which has emerged as a prominent victim of the global credit crunch.

AIG, which is the world's biggest insurance company, has agreed to sell its technical and industrial risk insurance unit Hartford Steam Boiler (HSB) to Munich Re as part of a major restructuring of its operations.

The deal is to be completed at the end of March with AIG having bought Connecticut-based HSB eight years ago for 1.2 billion dollars.

The decision by Munich Re, which is one of the world's leading reinsurers, to buy HSB underscores its moves to boost its operations in the key US market. (dpa)