A.M. Best Comments on Acquisition of National Lloyds Insurance Company and American Summit Insurance Company.OLDWICK, N.J. -- A.M. Best Co. has reviewed the proposed transaction regarding National Lloyds Insurance Company (National Lloyds) and its affiliate American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Summit Insurance Company (American Summit) following the announcement that their parent company, NLASCO, Inc., (all of Waco, TX) has reached a definitive agreement to be acquired by a subsidiary of Affordable Residential Communities Inc. (ARC arc, in electricity arc, in electricity, highly luminous and intensely hot discharge of electricity between two electrodes. The arc was discovered early in the 19th cent. by the English scientist Sir Humphry Davy, who so named it because of its shape. ) (NYSE NYSE See: New York Stock Exchange : ARC). A.M. Best anticipates that subsequent to the completion of this acquisition, which will be funded by various equity transactions, National Lloyds, current financial strength rating (FSR (Free System Resource) In Windows 3.x, the amount of unused memory in various 64K blocks reserved for managing current applications. Every open window takes some space in this area. See Windows memory limitation. ) of A (Excellent) and American Summit's current FSR of B++ (Very Good) will continue to maintain favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. risk-adjusted capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. and operating performance in line with their respective ratings. This expectation is based on both companies operating as independent wholly-owned subsidiaries of ARC with the existing NLASCO management and infrastructure remaining in place. Although growth is likely given the strategic opportunities associated with this transaction, A.M. Best anticipates growth will be measured and will not materially increase the overall risk profile of the statutory entities. While ARC maintains a relatively high financial leverage position, the majority of its debt is viewed by A.M. Best as operational given the predominately real-estate based activities of ARC. In addition it is anticipated that debt servicing requirements will continue to be funded via ARC's core real-estate operations with minimal impact on the statutory insurance entities. Accordingly, National Lloyds' and American Summit's FSRs are unaffected by this proposed transaction. For Best's Ratings Best's rating A rating A.M. Best Co. assigns to insurance companies based on the company's ability to meet its obligations to its policyholders. , an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. For current Best's Ratings, independent data and analysis on more than 3,000 individual property/casualty companies and A.M. Best groups, please visit www.ambest.com/pc. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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