AM Best has placed under review with negative implications the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a” (Excellent) of American Reliable Insurance Co. in Scottsdale, Arizona.
American Reliable is a member of Global Indemnity Group LLC.
The actions follow the recent announcement that ARIC completed the disposition of its farm, ranch and equine book of renewal business to Everett Cash Mutual Insurance Co. Global Indemnity also announced that it agreed to sell ARIC to ECM.
Under the proposed agreement, Global Indemnity will receive roughly $85 million, including the release of capital currently supporting ARIC’s operations. Until ECM acquires ARIC, ECM will be providing Global Indemnity with 100% quota share reinsurance subject to the renewal rights agreement with ECM. The sale of ARIC is expected to close sometime in the first quarter of 2023 and is subject to customary regulatory approvals, according to AM Best.
After the deal closes, ARIC will no longer be part of Global Indemnity and will no longer be a member of Global Indemnity’s intercompany pooling agreement, from which its ratings are derived. The under review with negative implications status reflects the anticipated removal of the group rating and the anticipated transfer of risk to ECM from Global Indemnity, according to AM Best.
Topics AM Best
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