November 3, 2010
Ken
Mr. Didden’s recent post regarding First Mercury is misleading in many respects. CoverX, First Mercury and the many professional independent agents and brokers who represent us in the alarm industry insurance marketplace have a commitment and dedication to this market that goes back to 1973. We are proud of our long-standing history in the alarm industry and look forward to continued success in the years to come.
First Mercury’s merger with Fairfax would put First Mercury under the ownership of a highly respected, global organization with significantly greater financial resources. We believe that this could only enhance First Mercury’s position as a niche-focused specialty carrier with a strong commitment and dedication to the alarm industry.
For an objective and unbiased view of the implications of the announced transaction, note that, as a result of the announced transaction, AM Best has put First Mercury under review with positive implications, and Moody’s has affirmed First Mercury’s rating and raised its outlook to positive.
John Bures,Senior Vice President
CoverX Corporation
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Ken,
I think it’s fair to say that we all appreciate you continually providing valuable information, via email, to thousands of us in the security industry. The open forum seems to work well, in most cases, and the feedback from the various professionals always interests me. Many things are black and white / right or wrong while others are simply just opinions or individual perspectives.
With that said, I felt the need to respond to the recent email where Bart shared his opinion on Prudential and their sub-insurers. I’m not really sure what the message was, if any. Was he just sharing his opinion and what he had learned about Prudential?
Understanding that Bart is the Executive Claims Administrator for SAARG, is he implying that SAARG is more financially sound than Hartford or Scottsdale and therefore a better choice? Many people that read these emails get confused and I believe the prudent thing to do is to ask a representative from SAARG to answer the following questions so that your readers can have factual information, in addition to individual opinions.
§ SARRG representatives questioning other carrier identities, (Who is The Hartford, Scottsdale and others …) is the proverbial “pot-calling-the-kettle-black”. We should equally ask who is SARRG? By current federal regulations, Risk Retention Groups must be state-chartered insurance companies. As a starting point, SARRG has the same DNA as the companies he is questioning the identities of.
§ SARRG is heavily supported by reinsurance carriers. Has SARRG fully evaluated the full identity of their reinsurance providers?
§ Another interesting fact -- Risk Retention Groups are every bit as unstable, long-term, as the companies mentioned. I was looking at a RRG study, and for the period 1987 – 2001. 142 risk retention groups were formed and 73 retired. As of the 3rd Quarter 2009, there were 239 risk retention groups filed with the NAIC. How many will there be in 2015? Can SARRG guarantee their solvency any stronger than any other carrier?
§ SARRG’s AM Best Rating also speaks to their long-term solvency. Is their rating, B++? That is far from the other A+ and A+ XV carriers that are being questioned.
This response and request for clarification is not an attack on Bart or SAARG. It’s simply for your readers to receive cold hard facts about insurance just like they do about equipment and industry procedures. Opinions are fine but facts are better. Facts allow everyone an opportunity to form their own opinions.
Kind regards,
Alice Cornett Giacalone
Senior Vice President
Berrian Insurance Group
(v) 800-917-2542