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FOR IMMEDIATE RELEASE
OLDWICK - MARCH 19, 2015 10:47 AM (EDT)
A.M. Best has placed under review with positive implications the financial strength rating (FSR) of B+ (Good) and the issuer credit rating (ICR) of "bbb-" of ARI Mutual Insurance Company (ARI) (Newtown, PA).
The rating action follows the announcement that AmTrust Financial Services, Inc. (AmTrust) has entered into a definitive agreement to acquire ARI in a subscription rights sponsored demutualization transaction. As part of the transaction, ARI will convert to a stock company from a mutual company. The under review with positive implications reflects A.M. Best's ratings of the property/casualty subsidiaries of AmTrust, which are assigned an FSR of A (Excellent) and the ICRs of "a." ARI also entered into a commercial automobile quota share reinsurance agreement with AmTrust pertaining to all policies in effect as of March 1, 2015. Under the quota share, ARI cedes 40% of its net business to AmTrust.
The ratings will remain under review until the close of the transaction, which is expected by the fall of 2015. The transaction is subject to regulatory and policyholder approvals.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Key insurance criteria reports utilized:
This press release relates to rating(s) that have been published on A.M. Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please visit A.M. Best's Ratings & Criteria Center.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.