A.M. Best Places HCC Insurance Holdings And Two Centris Units Under Review.OLDWICK, N.J.--(BUSINESS WIRE)--Oct. 15, 1999-- A.M. Best Co. today placed the A+ (Superior) ratings of HCC Insurance Holdings HCC Insurance Holdings, Inc. Group and Avemco Insurance Co. under review with negative implications. Simultaneously, it has placed the A- (Excellent) ratings of Centris Life Insurance Co. and Centris Insurance Co., as well as the A (Excellent) rating of USF USF University of South Florida USF Universal Service Fund (often part of phone bill in US) USF University of San Francisco USF University of Sioux Falls USF University of St. Insurance Co. under review with developing implications. These rating actions follow the Oct. 12, 1999, announcement by HCC Insurance Holdings Inc. that it has entered into an agreement to acquire Centris Insurance Group for approximately $146 million in cash, combined with the assumption of $25 million in debt that currently resides at the Centris Group Inc. Centris will retain an independent actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin firm to review its operations and make the appropriate reserve adjustments and other charges prior to the completion of the tender offer. The negative implications on the HCC HCC Hepatocellular Carcinoma (liver cancer) HCC Hertfordshire County Council (administrative region of south eastern England UK) HCC Harford Community College (Maryland) rating reflects the significant increase in financial leverage that will occur as a result of the acquisition, combined with the relatively short-term nature of the debt obligations that will be used to finance the transaction and the sizable increase in intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. . The purchase ultimately will be financed with $65 million in bank debt through an available credit facility and $76 million in cash from Houston Casualty Co. The transaction is not contingent upon Adj. 1. contingent upon - determined by conditions or circumstances that follow; "arms sales contingent on the approval of congress" contingent on, dependant on, dependant upon, dependent on, dependent upon, depending on, contingent financing. As a result of this transaction, the capital structure of HCC Insurance Holdings Inc. will consist of a $140 million revolving loan facility that will expire in February 2002 and a $100 million short term revolving loan facility that will expire in March 2000. However, management expects to be able to restructure its credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities before the close of the transaction to a five-year revolving loan facility. The remainder of its capital structure will consist of common equity. The negative implications also reflect the uncertainties in realizing various expense savings and the integration of Centris Insurance Group within the HCC organization, which will be complicated by a significant reunderwriting of Centris' medical stop-loss business. Over the past few years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time performance of the medical stop-loss business produced by Centris has not been consistent with that of a Superior-rated insurer. However, this transaction will expand HCC's accident and health line of business by adding a highly focused book of medical stop-loss business and ancillary products, along with an experienced underwriting staff. The combined entity will rank as the largest provider of medical stop-loss coverage in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . The developing implications on the ratings of the Centris Insurance Group reflect the enhanced capitalization of its insurance operations combined with HCC's conservative underwriting and reserving philosophies that will create a solid platform for the organization to take advantage of favorable market developments. However, the uncertainties related to integration will place pressure on the combined organization. The ratings of HCC and Centris will remain under review pending further discussions with management as well as regulatory approvals and the completion of the tender offer. The review will focus on the group's ongoing operations and the long-term strategic role Centris will place under HCC Insurance Holdings Inc. The ratings affected under the HCC Insurance Holdings Group are: Houston Casualty Co., National Insurance Underwriters, Trafalgar Insurance Co. and U.S. Specialty Insurance Co. HCC Insurance Holdings, Inc., an international insurance holding company, specializes in underwriting and providing accident and health, aviation, marine, medical stop-loss, offshore energy, property, and workers' compensation workers' compensation, payment by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work. insurance and reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. on a worldwide basis. Centris provides special risk accident and health insurance products and reinsurance intermediary services. A.M. Best Co., established in 1899, is America's oldest and most widely recognized insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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