Randall & Quilter (R&Q) Investment Holdings has acquired MPPA Insurance. R&Q will receive by way of novation all contracts underwritten by MPPA.
The contracts have been novated to cells in the R&Q-owned Bermuda rent-a-captive facility, R&Q Quest SAC. This required agreement of the two front companies, Travelers Indemnity Company and National Union Fire Insurance Company of Pittsburgh (part of AIG).
MPPA was formed in 1992 as a Class 2 Bermudian captive insurer of the Michigan Plastic Processors Association and has been in run-off since 2008. The captive wrote excess workers' compensation protecting the Michigan Plastic Processors Association’s self-insured fund.
Transferred assets in the novations amounted to $4.9 million, for which R&Q paid a transaction fee of $3.4 million. Transferring liabilities were estimated at $500,000 as of 28 February 2013.
Ken Randall, CEO of R&Q, said: “We are delighted to have completed this transaction which is our first for the Bermuda captive market. Having seen success in other domiciles in the last 12 months, notably Guernsey, we are pleased to now see increasing activity from Bermuda captives looking for exit or restructuring solutions. Whether acquisition, novation or loss portfolio transfers, [R&Q] has a suite of versatile solutions for the captive sector.”
