CHICAGO, June 21, 2005 TransGuard Insurance Co. of America, Inc., a subsidiary of SIRVA, Inc. (NYSE: SIR), a global relocation services provider, has signed agreements to reduce the impact on its customers of the recent rating action by A.M. Best Co. A.M. Best changed its rating of TransGuard from A- (Excellent) to B++ (Very Good) on April 27, 2005.
As a solution for its customers doing business with the military, on May 19, 2005, TransGuard entered into an agreement with Avalon Risk Management to place the military portion of its Moving and Storage line with Lincoln General Insurance Company, part of the Kingsway Financial Group. Lincoln General currently is rated A- (Excellent) by A.M. Best and will supply the proper coverage and certificates of insurance on all military exposures for the insureds of TransGuard, where coverage with an A- rated or better company is required.
For the remaining lines of its business (excluding workers compensation), TransGuard has signed an agreement with Hannover Re to provide additional protection, subject to the terms and conditions of the agreement, for the sole purpose of enhancing TransGuards policyholders and creditors position.
Hannover Re, rated A (Excellent) by A.M. Best, will supplement TransGuards existing reinsurance by assuming 100 percent of its net retained losses for coverage provided through the National Association of Independent Truckers (NAIT) and for the moving and storage (non-military) business. This coverage, which represents an interim agreement that will commute when SIRVA decides from among the strategic options currently under review, supplements TransGuards existing reinsurance coverages resulting in complete A- rated or better backing of these policies while no direct liability against TransGuards policyholders is assumed.
Our customers and brokers initial reaction has been very positive regarding these actions, said Larry Writt, president of TransGuard. We are working hard to make sure customers get the coverage and security they require.