A $1.7 billion Ohio holding company has signed a deal to buy Murfreesboro-based Consumers Insurance for an undisclosed amount.
Motorists Mutual Insurance President and CEO David Kaufman said adding 19-year-old Consumers to its family of companies will add opportunities in states in which it wants to do business. The local company employs about 65 people who will stay in Rutherford County.
"It’s staffed by talented, knowledgeable associates and it employs technological resources that make it an easy company for agents to do business with,” Kaufman said.
The agreement still needs approval from regulators in both Tennessee and Ohio as well as Consumers shareholders. When the deal is completed, Consumers will become a wholly owned subsidiary of Motorists Mutual and look to grow in its footprint.
"It is a win-win situation for our policyholders, employees, agents, and shareholders," Consumers Chairman Amanda Farnsworth (pictured here) said of the sale. "Motorists is an extremely well capitalized, A-rated company, [which] has a strong track record of building the companies they have partnered with in the past."
Consumers was founded in 1995 and now underwrites policies in Tennessee, Alabama, Arkansas, Missouri, Illinois, Indiana and Virginia. It books about $45 million in premiums annually and has assets of about $60 million. News of its sale comes a little more than a year after ratings agency A.M. Best cut its issuer credit rating  on the company, citing several years of losses that had shrunk its surplus by 13 percent. At the time, A.M. Best's analysts kept their widely used financial strength rating at B++.
Motorists last year booked a profit of $50.8 million, up from about $10 million in 2012, on a net written premiums base of $681 million. The holding company is home to 10 property and casualty and life insurance companies and brokerages and does business through 1,600 agencies in the Midwest, Northeast and Southeast. Its asset base ended 2013 at $1.72 billion , up from $1.64 billio