FOR IMMEDIATE RELEASE
OLDWICK, N.J., May 26, 2017A.M. Best has commented that the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of a of the members of Pacific Specialty Insurance Group (Pacific Specialty) remain unchanged following the recent announcement by Pacific Specialty that it has entered into a definitive agreement for Western Service Contract Corporation (parent of Pacific Specialty) and McGraw Insurance, Inc. (affiliated agency) to be acquired by Biglari Holdings Inc. [NYSE: BH]. The Credit Ratings (ratings) remain unchanged for the group members: Pacific Specialty Insurance Company and Pacific Specialty Property and Casualty Company (both headquartered in Palo Alto, CA). The outlook of these ratings remains stable.
The ratings and outlooks reflect Pacific Specialtys excellent risk-adjusted capitalization, favorable operating earnings and in-depth product knowledge as a California predominant personal and specialty lines writer. These positive rating attributes are partially offset by the groups business concentration in California, which exposes earnings and surplus to volatility from regulatory and judicial changes, market dislocations and catastrophe events.
The ownership change is not expected to have an impact on Pacific Specialtys management or day-to-day operations. It is expected that Pacific Specialty and its affiliated agency will operate independently of Biglari Holding Inc.s other insurance operations. The transaction is subject to customary closing conditions, including regulatory approvals. It is anticipated that the transaction will be completed in the third quarter of 2017.
This press release relates to Credit Ratings that have been published on A.M. Bests 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 A.M. Bests Recent Rating Activity web page. For additional information regarding the use and limitations of Credit
Rating opinions, please view Understanding Bests Credit Ratings. For information on the proper media use of Bests Credit Ratings and A.M. Best press releases, please view Guide for Media – Proper Use of Bests Credit Ratings and A.M. Best Rating Action Press Releases.
A.M. Best is the worlds oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.