A.M. Best Co. has placed under review with developing implications the financial strength rating of A (Excellent) and the issuer credit rating of “a” of Pennsylvania General Insurance Company (Penn General) (Philadelphia, PA).
The ratings will remain under review until the execution of an approved pooling agreement between Penn General, California Insurance Company (San Francisco, CA), Continental Indemnity Company and Laurier Indemnity Company (both domiciled in Cedar Rapids, IA), collectively referred to as North American Casualty Group (NAC). The pooling agreement is expected to be executed and approved in the fourth quarter of 2012.
Effective October 1, 2012, North American Casualty Company (Omaha, NE) purchased all of the issued and outstanding stock of Penn General from OneBeacon Insurance Group, LLC (OneBeacon). Prior to the sale, most of Penn General’s business was novated to OneBeacon with a small book of business fully reinsured by OneBeacon. As a result, Penn General was sold as a shell with all past business and associated liabilities retained by OneBeacon. NAC’s ultimate parent is Berkshire Hathaway Inc. [NYSE: BRK-A and BRK-B].
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. Key criteria utilized include: “Risk Management and the Rating Process for Insurance Companies” and “Rating Members of Insurance Groups.” Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
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