Business Moves

Royal & Sun

A state hearing officer recommended Delaware’s insurance commissioner approve the proposed management buyout and eventual dissolution of Royal and Sun Alliance Insurance Group’s U.S. operations. The subject of a lengthy hearing last month, the proposed buyout awaits Delaware Commissioner Matt Denn’s final decision.

Royal and Sun said it doesn’t consider its struggling U.S. business central to its main operations and stopped writing new policies hoping to eventually exit the U.S. market for the first in more than 150 years.

One of the U.S. subsidiaries, Royal Indemnity Co., which is incorporated in Delaware and manages Royal and Sun Alliance USA, was sued for more than $250 million by the developer of the World Trade Center site in New York City. Royal Indemnity and more than two-dozen other insurers took out policies with developer Larry Silverstein weeks before the towers collapsed. RSA USA is also involved in litigation over potentially costly asbestos and environmental claims.

Royal and Sun’s U.K. parent agreed to provide $287.5 million in financing for the buyout, but opponents contend that amount is insufficient to ensure obligations are met.

Widener University law professor Lawrence Hamermesh recommended Denn approve the buyout, over concerned raised by New York Sens. Hillary Clinton and Charles Schumer and New York City Mayor Michael Bloomberg who fear Royal Indemnity might not be able to meet its obligations, including helping to pay for the rebuilding of the World Trade Center site. Hamermesh said the deal meets all the requirements of Delaware law, and that there is no evidence that policyholders will be left holding the bag while RSA USA managers enrich themselves.

Putnam, Great-West Lifeco

Marsh and McLennan Companies Inc. said Great-West Lifeco Inc., a financial services holding company controlled by Canada-based Power Financial Corp., signed a definitive agreement to purchase its Putnam Investments. The sale price was $3.9 billion in cash.

The transaction is expected to close in the middle of this year subject to regulatory approval and other customary conditions.

MMC estimates the sale would have a mild negative impact on 2007 earnings per share of approximately five cents.

Dow Jones, N.Y. Captive

The New York State Insurance Department licensed Bergstresser Insurance Inc. as a captive insurance company. Bergstresser will insure the risks of Dow Jones and Co., the business and financial publishing company with properties including the Wall Street Journal and Barron’s.

According to Acting Insurance Superintendent Eric R. Dinallo, Bergstresser Insurance Inc. is the 39th captive insurance company licensed to operate in New York State.

Marquis Agency, Sharp & Associates

Woodbridge, N.J.-based Marquis Agency announced the asset acquisition of Thomas J. Sharp and Associates. The transaction will expand Marquis’ national professional services practice by adding Sharp’s team of brokers and risk managers focused on the design industry. Marquis is a subsidiary of the NIP Group Inc., a specialized business insurance and risk management intermediary.

Mass., Harleysville Worcester

Massachusetts officials gave the green light to the redomestication of Harleysville Worcester Insurance Co. to Pennsylvania. The company is a subsidiary of Pennsylvania-based Harleysville Insurance Group, whose officials sought the move in order to lower administrative and actuarial costs. Harleysville Worcester will now be examined by the Pennsylvania Insurance Department along with seven other subsidiaries Harleysville owns.

The company said the change would have no effect on policyholders or agents and would actually increase, not lower, tax payments to Massachusetts. No staffing reductions are expected in Worcester as a result of the change; management in fact anticipates adding to the Massachusetts staff.

Fisher & Fisher, Gowrie, Barden & Brett

Darien, Conn.-based independent insurance agency Fisher and Fisher merged with Westbrook-based Gowrie, Barden and Brett. The new company will maintain offices in Darien, Westbrook and Enfield, Conn. along with an office in Middletown, R.I.

PGI Commercial, Mich.

Morristown, N.J.-based PGI Commercial, the U.S. program manager of Bermuda-based insurance distributor Primary Group Limited, added an underwriting team and opened a branch office in Troy, Mich. The unit will specialize in providing liquor liability and BOP coverage for hospitality risks.

Susan Fowler and Elizabeth Hurcomb, of Fowler and Associates, have agreed to join PGIC bringing their staff and existing facility which is approved to write restaurants, bars, taverns and retail stores in Michigan.

Perr & Knight, Mass., R.I., Maine and Vt.

Perr and Knight, a provider of competitive intelligence services to the insurance industry, is now obtaining all approved property and casualty filings in Massachusetts, Maine, Rhode Island and Vermont. The company has been conducting business in these states for years, but is now expanding its east coast operations due to increased client demand.

In addition to the new states, Perr and Knight is already obtaining filings for California, New York, Pennsylvania, Illinois, Indiana, Washington, Oregon, Florida, Arizona, Nevada and North Carolina.

Perr and Knight’s www.ratefilings.com has more than 350,000 filings.

Arthur J. Gallagher & Co., InterNational

Arthur J. Gallagher and Co. acquired InterNational Insurance Group Ltd. of Boston, Mass. Terms of the transaction were not disclosed.

InterNational Insurance Group Ltd. specializes in life sciences, hospitality and environmental markets. Jeremy Alderman, Michael Neville and the staff will continue to operate in their Boston location under the direction of Douglas B. Brown, Gallagher’s Northeast regional manager.

BISYS, Truckwriters

BISYS Commercial Insurance Services acquired Truckwriters Inc., an Atlanta based managing general agency owned by and writing business with Zurich Programs.

Truckwriters will become part of BISYS’ managing general agent operations, BISYS Specialty Programs, a writer of trucking and transportation risks nationwide. The acquisition expands BISYS’ product line and includes a new market relationship and new niche client relationships.