ProAssurance Corporation, a Birmingham, Ala.-headquartered medical liability insurer, said it is acquiring Medmarc Insurance Group.
Medmarc, based in Chantilly, Virginia, specializes in products liability insurance for medical technology and life sciences companies. Under the deal, Medmarc will become part of ProAssurance through a proposed $153.7 million, all cash, sponsored demutualization that will provide Medmarc’s eligible members with cash payments of $146.2 million and future policy credits of $7.5 million.
ProAssurance is one of the largest medical professional liability insurers and also maintains a book of legal professional liability business. Medmarc is a leading underwriters of products liability insurance for medical technology and life sciences, and — like ProAssurance — also underwrites a book of legal professional liability insurance. Medmarc had direct written premium of $40.6 million in 2011 and $320 million in total assets as of March 31, 2012.
ProAssurance CEO Stan Starnes stated that the addition of Medmarc helps ProAssurance take another step toward its goal of expanding the range of insurance products to cover a wide spectrum of healthcare risks.
“As the delivery of healthcare evolves in the U.S., the professionals and organizations delivering the continuum of care will require additional and more complex insurance products, and this transaction will enhance our ability to respond to these dynamic new risks,” ProAssurance CEO Starnes noted.
ProAssurance will maintain Medmarc’s operations in Chantilly, Virginia, under the direction of its CEO Mary Todd Peterson.
The boards of directors for both companies have unanimously approved the transaction, which now requires the approval of Medmarc’s eligible members and insurance regulators in Vermont, where Medmarc is domiciled. The transaction is expected to close before the end of 2012.