Business & Finance
Business and Finance
Business and Finance
Mon, May 23, 2011
Sun, May 22, 2011
Fri, May 20, 2011 A.M. Best Comments on The Allstate Corporationa?s Proposed Acquisition of Esurance Insurance Company and Its Subsidiaries
OLDWICK, N.J.--([ BUSINESS WIRE ])--A.M. Best Co. has commented that the financial strength rating of A+ (Superior) and issuer credit ratings of aaa-a of Allstate Insurance Group (Allstate) and its members, led by Allstate Insurance Company (Northbrook, IL), are unchanged following the announcement that The Allstate Corporation (Allcorp) (NYSE: ALL) has signed a definitive agreement with White Mountains Insurance Group, Ltd (NYSE: WTM) to acquire Esurance Insurance Company and its subsidiaries, Esurance Insurance Company of New Jersey and Esurance Property & Casualty Insurance Company.
Under the terms of the agreement, which also includes the purchase of Answer Financial Inc., Allcorp will pay $700 million plus the tangible book value of all the entities acquired at the close of the transaction. The total price is expected to be approximately $1.0 billion. The transaction has been approved by both companiesa™ boards of directors and is expected to close in the fall of 2011, pending regulatory approvals.
Esurance sells personal automobile insurance directly to customers online and through call centers. Answer Financial, Inc., as a personal lines insurance agency, allows clients to compare quotes and purchase insurance through its website and store fronts. These acquisitions are expected to further Allstatea™s strategy of utilizing different value propositions for distinct customer segments. A.M. Best believes the transaction will improve Allstatea™s overall market position by expanding its distribution capacity in the growing direct channel.
The principal methodology used in determining these ratings is [ Besta™s Credit Rating Methodology -- Global Life and Non-Life Insurance Edition ], which provides a comprehensive explanation of A.M. Besta™s rating process and highlights the different rating criteria employed. Additional key criteria utilized include aRating Members of Insurance Groups.a Methodologies can be found at [ www.ambest.com/ratings/methodology ].
Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit [ www.ambest.com ].
Copyright © 2011 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.
