Posted on 05 Feb 2008
OLDWICK, N.J.--(BUSINESS WIRE)--February 5, 2008--A.M. Best Co. has commented that the financial strength rating of A (Excellent) and the issuer credit rating of “a+” of Great Midwest Insurance Company (GMIC) (Byron Center, MI) are unchanged following the recent announcement that Southwest Insurance Partners Inc. (SWIP) (Houston, TX), a recently formedTexas holding company, has acquired FMG2, the parent company of GMIC, its affiliated underwriting agency, Shel-Ray Underwriters, Inc., and all of its subsidiaries.
The GMIC management staff will remain in place, directing the company’ s operations with a continuing focus on conservative expansion through existing producers, while maintaining underwriting discipline and risk profile. There are no plans for GMIC to pay shareholder dividends in the medium term. While the transaction involves a modest amount of debt, total financial leverage of approximately 40% (debt-to-total capital) is comfortably supported by earnings outside the GMIC legal entity and is within A.M. Best’ s parameters for the current rating level. This transaction will provide GMIC with additional financial flexibility going forward.
SWIP was established to make acquisitions and investments in the property/casualty industry. Investors include several highly rated insurance companies and high net worth individuals.
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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.