North Point Holdings Acquires Home Pointe Insurance for $15.3 Million

Mich.-based North Pointe Holdings Corp. announced Monday that it has signed an agreement for the sale of its Home Pointe Insurance Co. subsidiary, which comprises North Pointe’s Florida homeowners and dwelling fire operations, to American Capital Assurance Corp., a subsidiary of Safe Harbour Holdings, LLC, a Florida domiciled insurance holding company.

The purchase price for the acquisition is equal to Home Pointe’s current GAAP book value, which is approximately $15.3 million.

In December 2004, North Pointe, through one of its subsidiaries, began offering new homeowners and dwelling fire insurance to former policyholders of an unaffiliated insurer that was in liquidation in Florida. In June 2006, North Pointe decided to reduce Florida commercial and residential property exposure caused by restrictions in the reinsurance market and regulatory constraints in Florida. The result was a significant reduction in probable maximum loss, wind exposure, as well as commercial and residential policies. As part of this planned exposure reduction, the Florida homeowners book of business has been under strategic review.

James Petcoff, North Pointe’s chairman and CEO, said, “As our growth strategy has evolved, we have sharpened our focus on specialty niche commercial coverages that enable us to leverage our capabilities and operating platform. We determined the Florida homeowner’s operations would be a better strategic fit under a new owner.”

Safe Harbour was recently capitalized by a consortium of Arx Holding Corp., Flexpoint Partners, LLC, and New Capital Partners in order to pursue opportunities in the Florida property and casualty market. Arx Holding Corp., through three subsidiary property and casualty insurance companies, has focused primarily on the homeowners market in Florida and Texas, while Flexpoint Partners and New Capital Partners are private equity funds that specialize in financial services investments.

John Auer, Chief Executive Officer of Arx Holding Corp. and Safe Harbour, said, “The acquisition of Home Pointe will provide a solid foundation for expansion into homeowners and dwelling coverages. To date, Safe Harbour has primarily focused on commercial habitational risks.”

The transaction is expected to close following the receipt of regulatory approval.

North Pointe Holdings is a property and casualty insurer that markets both specialty commercial and personal insurance products.

Source: North Pointe Holdings Corp.

Topics Florida Mergers & Acquisitions Homeowners Property Casualty