NU Online News Service, April 4, 10:34 a.m. EDT
The Main Street America Group, and Austin Mutual Insurance Co., a Minnesota-domiciled regional property and casualty carrier, have reached an agreement to establish Austin Mutual as an affiliate of Main Street America.
Main Street America, a major regional property and casualty mutual insurance holding company based in Jacksonville, Fla., says the affiliation agreement, approved by the boards of both companies, is subject to regulatory approval from the State of Minnesota Insurance Commissioner’s Office as well as policyholders of Austin Mutual.
The closing is projected to occur by midyear 2012.
Terms of the transaction were not disclosed.
Austin Mutual, founded in 1896, will maintain its brand name and continue to sell its products via its network of independent agents in nine Midwest and Western states, Main Street America says.
The company went on to say that under terms of the affiliation, Austin Mutual chairman, president and chief executive officer Jeffrey Kusch will continue to oversee the company’s daily operations out of its Maple Grove, Minn., headquarters and report to Tom Van Berkel, chairman, president and chief executive officer of Main Street America. There will also be a management and services agreement in place between the two companies and Main Street America will provide Austin Mutual with quota share reinsurance.
“The Main Street America Group’s long-term strategy to sustain profitable growth is focused on spreading risk and increasing scale through geographic diversification and we will take another step in this direction by establishing an affiliation with Austin Mutual,” says Van Berkel in a statement.
Over the past four years, Main Street America says it has established a Midwest presence through an acquisition of Michigan-domiciled Great Lakes Casualty Insurance Co. in 2008, and two other affiliations: Indiana-domiciled Grain Dealers Mutual Insurance Company in 2009 and Minnesota-domiciled Spring Valley Mutual Insurance Company in 2011.