A.M. Best places Fremont Compensation Insurance Group, Industrial Indemnity Insurance under review after announcing planned sale.OLDWICK, N.J.--(BUSINESS WIRE)--May 20, 1997--Effective immediately, A.M. Best Co. has placed the "A-" (Excellent) ratings of the Fremont Compensation Insurance Group under review with developing implications and the "A" (Excellent) ratings of the Industrial Indemnity Insurance indemnity insurance Managed care A type of health insurance in which a Pt can choose the hospital and provider, and the insurer reimburses the Pt or provider for a set percentage of the cost, minus deductibles and co-payments Group under review with negative implications. The rating actions follow Fremont General Corp's announcement that it had entered into a definitive agreement to purchase Industrial Indemnity Recompense for loss, damage, or injuries; restitution or reimbursement. An indemnity contract arises when one individual takes on the obligation to pay for any loss or damage that has been or might be incurred by another individual. Holdings Inc. from Talegen Holdings, Inc. for $365 million in cash. In addition, Fremont will repay Industrial Indemnity's $79 million outstanding debt obligation to Talegen. The acquisition will result in an approximate fifty percent increase in 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. business. It is expected to bring several benefits to Fremont, including a well established Western state workers' compensation franchise enhancing business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets outside of it's core Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. and California markets. Further, Industrial Indemnity provides Fremont with additional underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. expertise, new distribution opportunities, and potential expense savings in common operating territories. While Fremont has demonstrated its successful acquisition strategy, A.M. Best is concerned about Fremont's ability to effectively administer and integrate the combined operations For the department of the British War Office during World War II, see . In the military, combined operations are operations conducted by forces of two or more allied nations acting together for the accomplishment of a single mission. See also
Upon close of the transaction, A.M. Best anticipates lowering Industrial Indemnity's rating reflecting its affiliation with the lower rated Fremont. The ratings will remain under review pending the close of the transaction and discussions with management regarding operating plans and financing for the combined group. The acquisition is expected to close in the third quarter of 1997 and is subject to approvals by regulators, as well as the satisfaction of additional closing conditions. A.M. Best Co., established in 1899, is America's oldest and most widely recognized insurance rating and information source. CONTACT: Jeffrey Dunsavage (908) 439-2200, ext. 5618 http://www.ambest.com |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion