A.M. Best Co. has placed the financial strength rating (FSR) of ‘A-‘ (Excellent) and issuer credit rating (ICR) of “a-” of North Pointe Insurance Company (NPIC) of Michigan, and the FSR of ‘B+’ (Good) and ICR of “bbb-” of North Pointe Casualty Insurance Company (NPCIC) of Jacksonville, Fla. under review with positive implications. Best also placed the FSR of ‘B++’ (Good) and the ICR of “bbb+” of Capital City Insurance Company, Inc. of Columbia, So. Carolina under review with positive implications. All of the companies are subsidiaries of Michigan’s North Pointe Holdings Corporation (NPHC).
The rating actions were initiated by the recent announcement that NPHC has entered into a definitive agreement to be acquired by QBE Holdings, Inc. (QBE) in a merger agreement [See IJ web site-https://www.insurancejournal.com/news/national/2008/01/04/86092.htm].
QBE is a subsidiary of Australia’s QBE Insurance Group, Limited. Best noted that the Company currently conducts both insurance and reinsurance business through P/C subsidiaries in eight countries headquartered in North and South America. Best also indicated that it “expects the ICR of “bb+” of NPHC to be withdrawn upon the completion of its acquisition by QBE.”
Best said it had based its rating actions “on the increased financial wherewithal anticipated to be available to NPHC and its subsidiaries as a result of the transaction. NPHC will be a member of QBE Americas, which had in excess of $2 billion in policyholders’ surplus through third quarter 2007. The acquisition of NPHC is being funded by existing cash held by QBE in the United States.
“The under review status takes into consideration the change in ownership and the integration risks associated with this latest addition to QBE’s U.S. operation. This risk is partially mitigated by the experience QBE has integrating large insurance operations.”
Source: A.M. Best – www.ambest.com/ratings.
Was this article valuable?
Here are more articles you may enjoy.