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STATE OF MAINE
Deputy Superintendent of Insurance Eric A. Cioppa issues this Decision and Order in the above-captioned proceeding.1 The proceeding was instituted upon the application of New London County Mutual Insurance Company (“NLC” or the “Applicant”), a Connecticut domiciled insurer, for approval of its indirect acquisition of Casco Indemnity Company, (“Casco”), a Maine domiciled insurer, as a result of its proposed acquisition through affiliation of Hingham Mutual Fire Insurance Company (“Hingham”) which is a controlling person of Casco.
I. THE PROPOSED ACQUISITION
Casco is a direct, wholly-owned subsidiary of NE Corporation (“NE”), a Maine domiciled insurance holding company. Hingham and Hingham’s indirect, wholly-owned subsidiary, Danbury Insurance Company (“Danbury”) collectively own approximately 55.2% of the capital stock of NE. The remaining 44.8% of the NE stock is owned by Phenix Mutual Fire Insurance Company. Hingham is a mutual property and casualty insurance company domiciled in the Commonwealth of Massachusetts. Danbury is a stock insurance company domiciled in the Commonwealth of Massachusetts.
NLC proposes to acquire direct control of Hingham and indirect control of Danbury pursuant to the terms of an Affiliation Agreement dated June 9, 2010. The Applicant has sought the approval of the Commissioner of the Division of Insurance of the Commonwealth of Massachusetts. The Massachusetts Commissioner approved the transaction on August 19, 2010 subject to this office’s approval as well as the approval of Hingham’s policyholders.
II. PROCEDURAL HISTORY
NLC filed its application for approval and the requisite Form A statement with this office on June 22, 2010. The Deputy Superintendent issued a Notice of Pending Proceeding and Hearing in this matter on August 9, 2010. That Notice designated NLC and Casco as parties to the proceeding. It also provided interested persons an opportunity to submit an application to intervene in the proceeding, but no one chose to do so prior to the hearing.
The public hearing was held as scheduled on August 27, 2010. NLC and Casco attended the hearing. Hingham and Danbury, through Counsel, requested and were granted late status as intervenors without objection by the parties.
At the hearing, certain evidence was offered and admitted into the record of the proceeding without objection, including the filing, an information request and responses thereto issued during the proceeding and the Decision and Order of the Massachusetts Commissioner approving the transaction. Testimonial evidence was provided at the hearing by Steve Chevalier, President and Chief Executive Officer of NLC, George A. Cole III, President and Chief Executive Officer of Hingham and Chief Executive Officer of Danbury and William Swetland III, President and Chief Executive Officer of Casco.
III. STANDARD OF REVIEW
As identified in the Notice of Pending Proceeding and Hearing, the legal standard of review for the consideration of the ending application is set forth in 24-A M.R.S. §§222(7)(A) and 3476(2) and includes the following:
In addition to the legal standards of review under 24-A M.R.S.A. §§ 222 and 3476 as identified above, the Deputy Superintendent in his discretion may consider such other relevant issues identified by parties or otherwise.
IV. FINDINGS OF FACT AND CONCLUSIONS OF LAW
Based upon the testimonial and documentary evidence presented at the hearing and upon a review of the record of this proceeding, the Superintendent finds that no issues of material concern exist with respect to NLC’s abilities to satisfy the legal standards for approval set forth in 24-A M.R.S. §§222(7)(A) and 3476(2), summarized as follows:
For all of the foregoing reasons, the Superintendent concludes that NLC has met the legal standards for approval set forth in 24-A M.R.S. §§222(7)(A) and 3476(2).
The application of NLC to acquire indirect control of Casco through its affiliation with Hingham is hereby APPROVED subject to receipt of approval of the transaction by the policyholders of Hingham. NLC’s acquisition of control of Casco is further subject to the ten day waiting period requirement of 24-A M.R.S. §222(4-A)(C).
VI. NOTICE OF APPEAL RIGHTS
This Decision and Order is a final agency action of the Superintendent of Insurance within the meaning of the Maine Administrative Procedure Act. It may be appealed to the Superior Court in the manner provided by 24-A M.R.S. §236, 5 M.R.S. §11001 et seq. and Maine Rule of Civil Procedure 80C. Any party to this proceeding may initiate an appeal within thirty days after receiving this notice. Any aggrieved non-party whose interests are substantially and directly affected by this Decision and Order may initiate an appeal within forty days of the issuance of this decision. There is no automatic stay pending appeal; application for stay may be made in the manner provided for by 5 M.R.S. §11004.
1 Superintendent of Insurance Mila Kofman delegated all procedural and decision making legal authority with respect to this proceeding to Deputy Superintendent Cioppa. See 24-A M.R.S.A. § 206(2).
PER ORDER OF THE SUPERINTENDENT OF INSURANCE
Last Updated: August 22, 2012
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