CONTACTS:
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - DECEMBER 03, 2002 12:00 AM (EST)
A.M. Best Co. has placed the financial strength rating of B-(Fair) of Mutual Fire Insurance Company of Calvert County (Prince Frederick, MD) under review with positive implications.
The rating acknowledges the letter of intent signed between Mutual Fire and Cumberland Insurance Group (Bridgeton, NJ). Both boards agreed to enter into an affiliation as well as a reinsurance agreement whereby 100% of Mutual Fire's business will be ceded to Cumberland effective December 31, 2002. Additionally, pending regulatory approval from both the Maryland and New Jersey departments of insurance, Mutual Fire will be fully merged into Cumberland. A.M. Best views this transaction favorably for Mutual Fire, as it will restore the company's financial strength. Also, this merger will enhance Cumberland's entrance into the Maryland market by providing it with a strong agency presence. The affiliation will have no impact on the financial strength rating of A+ (Superior) of Cumberland. Regulatory approval is expected during 2003.
Mutual Fire provides homeowners, fire and allied lines, farm owners and commercial multiple peril coverages. Business is written in the states of Maryland and Pennsylvania. Business is produced through several distribution channels on a direct basis, utilizing 30 independent agents and approximately 25 brokerage firms. Rates are independently filed with all policies issued on a non-assessable basis. In Maryland, the company's largest concentration of business is located on the western shore of the Chesapeake Bay primarily in the southern counties.
A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source.