Business & Finance
Business and Finance
Business and Finance
Tue, August 10, 2010 A.M. Best Comments on Hallmark Insurance Companya?s Proposed Acquisition of State Auto National Insurance Company
OLDWICK, N.J.--([ BUSINESS WIRE ])--A.M. Best Co. has commented that the financial strength rating (FSR) of A- (Excellent) and issuer credit ratings (ICR) of aa-a of Hallmark Insurance Group (Hallmark Group) (Fort Worth, TX) and its operating members and the ICR of abbb-a of its holding company parent, Hallmark Financial Services, Inc. (Hallmark Financial) (Nevada) (NASDAQ: HALL), are unchanged following the announcement of Hallmark Insurance Companya™s (Hallmark) proposed acquisition of State Auto National Insurance Company (State Auto National). The operating members of Hallmark Group include Hallmark Insurance Company, American Hallmark Insurance Company of Texas, Hallmark Specialty Insurance Company and Hallmark County Mutual Insurance Company.
Pursuant to a definitive agreement with Hallmark, State Auto National, a non-standard personal automobile writer, will become a wholly owned subsidiary of Hallmark. The acquisition is not expected to materially impact Hallmark Groupa™s risk-adjusted capitalization or earnings, nor the financial leverage of Hallmark Financial. The acquisition is expected to enhance Hallmark Groupa™s geographic diversification efforts by providing an increased agency platform in Tennessee, Kentucky, West Virginia, Ohio and Maryland.
These positive factors are partially offset by Hallmark Groupa™s continued execution risk associated with the integration and development of its various acquisitions in recent years.
For Besta™s Credit Ratings, an overview of the rating process and rating methodologies, please visit [ www.ambest.com/ratings ].
The principal methodology used in determining these ratings is [ Best's Credit Rating Methodology - Global Life & Non-Life Insurance Edition. ]Additional methodologies that may apply can be found at [ www.ambest.com/ratings/methodology ].
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 ].
