American Overseas Reinsurance Company, a division of American Overseas Group Limited, has entered into a commutation, reassumption and release agreement with Assured Guaranty Municipal Corp. (AGM).
The agreement sees the company’s reinsurance operating subsidiary commute the remaining $345 million outstanding par value of financial guaranty reinsurance business it had assumed from AGM (AGM Commutation).
As of the April 1st, 2020 effective date of the commutation, American Overseas Reinsurance Company has exited the financial guaranty line of business, and will continue to write affiliated reinsurance arising from its parent’s U.S. domiciled nonstandard auto insurance businesses.
The Bermuda-based property & casualty holding company first announced plans to commute part of its AGM reinsurance portfolio in June of last year, noting at the time that the arrangement would have no material impact on its net GAAP income.
