Canadian Underwriter

Gerling Canada upgraded following sale

July 14, 2003   by Canadian Underwriter

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On news of the finalized purchase of Gerling Canada Insurance Co. by a group of Toronto-based investors, A.M. Best has upgraded the company’s financial strength rating to “A” (excellent) from “A-” with a stable outlook.
The new entity, to be known as GCAN Insurance Co., is now owned by GCAN Holdings Inc., with investors consisting of Torquest Partners, Newport Partners Inc., CIBC Capital Partners and company senior management.
A.M. Best says the sale quelled uncertainty with regards to parent company Gerling Group, which has been under reorganization.
“The upgrade reflects Gerling Canada’s superior operating performance, excellent capitalization and its well defined business position within the industrial insurance sector,” states an A.M. Best release. “The company’s underwriting results have consistently outperformed the industry. Gerling Canada further benefits from its conservative operating philosophy and experienced management team.”
Offsetting factors include the company’s reliance on reinsurance, where prices continue to rise. The company will also be servicing debt through dividend payments in the future, A.M. Best notes.

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