OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has placed under review with negative implications the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” (Excellent) of Westminster American Insurance Company (WAIC) (headquartered in Owings Mills, MD).
These Credit Ratings (ratings) have been placed under review with negative implications following the recent announcement made by NI Holdings, Inc. [NASDAQ: NODK], its ultimate parent, that a definitive agreement has been signed to sell WAIC to a private party. The transaction has been approved by the board of directors and is currently pending regulatory approvals and subject to customary closing conditions. Once the agreement closes, WAIC will no longer maintain an affiliation with Nodak Insurance Group (Nodak) and will be removed from the pool, with its participation percentage re-allocated among the remaining pool members.
NI Holdings, Inc. purchased WAIC through a 100% stock purchase agreement in 2020, and subsequently, the company was added as a member to the Nodak pool to diversify its book of business from a product and geographic standpoint. However, NI Holdings, Inc. has agreed to sell WAIC as management felt the company’s core lines of business (i.e., commercial habitational risks) and regional areas of operations no longer aligned with Nodak’s overall risk appetite. In recent years, and particularly in 2023, WAIC’s results in its core lines of business were a drag on the Nodak group’s overall results. WAIC’s ratings will remain under review with negative implications pending successful execution of the transaction and until AM Best can properly assess the company’s rating fundamentals, financially and operationally, on a standalone basis without integration in the Nodak pool. WAIC’s ratings likely will be negatively affected when removed from under review.
This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
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