WRM America Holdings,LLC, a specialty lines property & casualty insurance andrisk management holding company, has reached a definitive agreementto acquire the flood insurance business of Fidelity NationalFinancial Inc. That unit—Fidelity National Indemnity InsuranceCo. (FNII)—will operate as a wholly owned subsidiary of WRMAmerica.
|WRM says FNII's central operations will remain in St. Petersburgand the group will retain its 220 employees. The business willcontinue to be led by Patty Templeton-Jones and G. Michael Sloane,who will become members of the senior management team at WRMAmerica.
|FNII is reportedly the nation’s largest provider of federalflood insurance through the National Flood Insurance Program(NFIP). It had over 17 percent of the total write-your-own programmarket in 2010.
|Under the terms of the agreement, WRM America will acquire FNIIand Fidelity National Insurance Services for $210million—consisting of approximately $122.5 million in cash, $75million in a seller note, and approximately $12.5 million in anexpected cash dividend. The transaction is expected to close in thefourth quarter of 2011, subject to regulatory approval andcustomary closing conditions.
|NFIP, which was launched in the 1950s, is currently asignificant topic of discussion in Washington. The program isoperating under a short-term reauthorization deadline that expireson September 30. On July 13, the U.S. House passed legislation reauthorizing the program untilSept. 30, 2016. Insurance industry groups are urging similar actionfrom the Senate.
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