Premia Holdings Ltd. Has Acquired Alan Gray LLC

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HAMILTON, Bermuda–(BUSINESS WIRE)–Premia Holdings Ltd., a leading reinsurance group focused on reinsuring and acquiring companies in runoff, has acquired Alan Gray LLC, a highly respected international claims, audit and risk management advisory firm that has been a trusted advisor to its clients for over thirty years.

“I have been a client of Alan Gray’s for over 20 years across a broad spectrum of services. I know firsthand what a tremendous job they do for their clients. They bring tremendous expertise and cost effective solutions to every assignment. We are thrilled to make them a part of our group and we look forward to working with them to accelerate their growth and create even more satisfied clients,” commented Bill O’Farrell, CEO of Premia Holdings.

Alan Gray LLC was established in 1988 as a claims and audit advisory firm, and over the years has built a reputation as an efficient and trusted resource to those involved in the management of risk. The firm provides claims administration and audit services, actuarial, underwriting, legal bill auditing, reinsurance collections and risk management services to clients including leading insurers and reinsurers, MGAs, self-insured corporations and public entities.

“All of us on the Alan Gray team are very pleased to join the Premia team. It will allow us to bring our traditional services to new clients while providing our long standing clients expanded solutions to help them achieve their business objectives,” remarked Michael F. Ceppi, CEO of Alan Gray LLC.

Dowling Hales acted as exclusive advisor to Vanbridge, the seller.

KBRA Assigns Insurance Financial Strength Rating of A- to Premia Re

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NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) has assigned an insurance financial strength rating (IFSR) of A- to Premia Reinsurance Ltd. (Premia), a class 4 Bermuda specialty reinsurer focused on acquiring nonlife run-off liabilities. KBRA has also assigned an issuer rating of BBB to the organization’s ultimate holding company, Premia Holdings Ltd. (Premia Holdings). Premia and Premia Holdings are collectively referred to as Premia Re. Additionally, KBRA has assigned a rating of BBB to Premia Holdings’ outstanding senior unsecured notes. The Outlook for all ratings is Stable.

The ratings reflect Premia Re’s sound capitalization, which KBRA believes is sufficient to support the company’s planned acquisition strategy of run-off liabilities in the medium term. Part of Premia’s capital consists of $110 million of senior unsecured notes due January 2024. Additionally, Premia Re’s ratings benefit from the equity investment of Arch Capital Group Ltd. (Arch Capital) (NASDAQ: ACGL), a 25% quota share reinsurance agreement between the companies, as well as underwriting, systems, and operational support from Arch Capital. Moreover, Premia Re’s management team has extensive experience in the reinsurance market, especially in the run-off sector, and has successfully closed on a number of transactions during the company’s first year of operation. Premia Re acquires companies and portfolios in less volatile lines of business, eschewing property catastrophe exposure, and will maintain conservative financial leverage – currently 22%.

Balancing these strengths is the start-up nature of the company and the execution risk for Premia Re’s management team as they enter a mature sector with established competitors. Although KBRA acknowledges that nonlife run-off business has demonstrated favorable return characteristics that are largely uncorrelated to the overall financial markets, the potential still exists for run-off business to experience adverse reserve development. KBRA expects Premia Re to report a small operating loss in 2017, its first year of operations, and achieve profitability in 2018. Finally, key man risk exists in that Premia Re needs to continue to build out its management team over time to develop bench strength for succession planning.

The Stable Outlook reflects KBRA’s expectations that Premia Re will continue to maintain sound capitalization while successfully executing its run-off acquisition strategy. Additionally, KBRA expects Premia Re to experience minimal credit losses in its investment portfolio, retain key members of its management team, and preserve financial flexibility through conservative balance sheet metrics.

The ratings are based on KBRA’s Global Insurer & Insurance Holding Company Rating Methodology published on October 10, 2017.

Please click here to view the report.

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About KBRA and KBRA Europe

KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.


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Reactions Magazine Selected Premia Holdings Ltd. (“Premia”) as its Launch of the Year

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Premia is a Bermuda-based company that is backed by private equity firm Kelso & Company (“Kelso”) and insurer Arch Capital Group Ltd. (“Arch”). Premia raised US$510 million in initial capital, including US$100 million from Arch and its co-investors, US$300 million from Kelso and its co-investors, and US$110 million in senior unsecured debt from a leading private equity firm.

Premia’s January 2017 capital raise is notable for being the largest-ever start-up reinsurer dedicated to runoff solutions and for employing an innovative structure that was previously unutilized in the property and casualty runoff market. Upon its launch, Premia was immediately
recognized as a significant industry player and is now competing for some of the market’s largest runoff transactions.

Reactions magazine is a leading global re/insurance publication. Its annual awards recognize transactions that have made a lasting impression on the North American insurance and reinsurance industry.