OLDWICK, N.J.--(BUSINESS WIRE)--
A.M. Best Co. has commented that the ratings and outlook of
ProAssurance Corporation's (PRA) (NYSE: PRA) insurance subsidiaries
remain unchanged following its recent announcements of two
transactions.
On October 28, 2008, PRA announced that the PICA Group (PICA)
(Nashville, TN) will become part of PRA. The ratings and outlook of
PICA also are unchanged.
The PICA transaction is an all-cash, sponsored demutualization,
which has been approved by its and PRA's Board of Directors and now
requires the approval of PICA policyholders and approval of insurance
regulators in Illinois, where PICA is domiciled. When the
demutualization is approved by PICA's insureds, PRA will pay PICA's
eligible mutual policyholders $120 million to buy the stock created by
the demutualization. The transaction, which is expected to close in
first quarter 2009, also provides PICA policyholders a total of $15
million in premium credits upon policy renewals, beginning in 2010 and
spread over three years. The approved definitive agreement also
includes a capital contribution from PRA to PICA upon closing. PICA is
expected to operate as a wholly-owned, stand-alone subsidiary of PRA
with its current management.
On October 15, 2008, PRA announced its purchase of Georgia Lawyers
Insurance Company (GLIC) (Fayetteville, GA). ProNational Insurance
Company (ProNational) (Okemos, MI), a PRA subsidiary, will pay $4.3
million in cash to GLIC shareholders. The closing, which also is
expected in first quarter 2009, has been approved by GLIC's
shareholders and is subject to the approval of the Georgia Department
of Insurance. Following the closing, GLIC will be merged into
ProNational.
For Best's Ratings, an overview of the rating process and rating
methodologies, please visit www.ambest.com/ratings.
Founded in 1899, A.M. Best Company is a global full-service credit
rating organization dedicated to serving the financial and health care
service industries, including insurance companies, banks, hospitals
and health care system providers. For more information, visit
www.ambest.com.
Source: A.M. Best Co.
Contact: Analysts
Greg Williams, 908-439-2200, ext. 5815
greg.williams@ambest.com
or
Robert Brokaw, 908-439-2200, ext. 5771
robert.brokaw@ambest.com
or
Public Relations
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com