A.M. Best Places Ratings of American General Holdings Group and Its Members Under Review With Positive Implications

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has placed under review with positive implications the financial strength rating (FSR) of C++ (Marginal) and issuer credit ratings (ICR) of “b” ofAmerican General Holdings Group (AGHG) and its members, Apollo Casualty Company(ACC) and Delphi Casualty Company(DCC) (all domiciled in Des Plaines, IL).

These rating actions follow the signing of a definitive agreement between American General Holdings, Inc. andOmni Insurance Company (OMNI) (Atlanta, GA), whereby OMNI will purchase 100% of the stock of AGHG’s lead company, ACC and its separately rated subsidiaries, DCC and Apollo Casualty Company of Florida(ACCF) (Pompano Beach, FL). OMNI is the largest pool member of the American Independent Companies (AIC) (headquartered in Conshohocken, PA).

Concurrently, A.M. Best has placed under review with developing implications the FSR of C++ (Marginal) and ICR of “b” of ACCF. ACCF is a wholly-owned subsidiary of ACC and is currently in runoff with its long-term strategic position within AIC being unclear at this time.

When the transaction closes, ACC and DCC are expected to be added to the current pooling agreement of AIC. AIC currently serves personal and commercial customers in several states and regions. ACC is expected to continue to operate as a separate entity writing non-standard and commercial auto business in Illinois, and will be joining a larger, more geographically diversified insurance group, which is expected to result in greater economies of scale.

The ratings for AGHG and its members will remain under review pending regulatory approval, close of the transaction and further discussions with management. The transaction is expected to close before the end of the second quarter of 2011.

The principal methodology used in determining these ratings is Best’s Credit Rating Methodology -- Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best’s rating process and highlights the different rating criteria employed. Additional key criteria utilized include: “Risk Management and the Rating Process for Insurance Companies”; “Understanding BCAR for Property/Casualty Insurers”; “Rating Members of Insurance Groups” and “A.M. Best’s Ratings & the Treatment of Debt.” 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.

A.M. Best
Kevin Dorsey, 908-439-2200, ext. 5401
Senior Financial Analyst
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or
Rick Decker, 908-439-2200, ext. 5423
Assistant Vice President
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or
Rachelle Morrow, 908-439-2200, ext. 5378
Senior Manager, Public Relations
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or
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
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Source: A.M. Best Co.