NU Online News Service, Dec. 22, 9:22 a.m. EST

ACE Ltd.’s purchase of Penn Millers has prompted insurance rating agency A.M. Best Co. to upgrade the financial strength rating of the agribusiness insurer.

A.M. Best says the financial strength rating of Penn Millers Insurance Group is now “A,” an upgrade from “A-minus.”

The acquisition of the Wilkes Barre, Pa.-based group, which includes Penn Millers Insurance Co., by ACE will allow Penn Millers to take “advantage of being part of a large and diverse global organization with favorable financial leverage,” A.M. Best says in a statement.

“Penn Millers’ positive outlook reflects additional benefits expected to be realized in the near term, including enhanced explicit levels of support and expense savings,” A.M. Best adds.

ACE completed its $107 million cash buy of Penn Millers Holding Corp. and its subsidiaries early in December.

Penn Millers Insurance Co. operates in 34 states and provides insurance to companies that manufacture, process and distribute agricultural products.

The company will survive as a wholly-owned subsidiary of ACE.

Penn Millers said it had been reviewing strategic alternatives, including a sale, as it continued to be adversely affected by soft-market conditions and weather-related catastrophes.

Special Reports /

A.M. Best Upgrades Penn Millers After ACE Buy

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