Policyholder report estimates RSA unit has $1.83 billion in claims, $834 million surplus.(News)(Royal and SunAlliance USA)

Business Insurance, January, 2007 by Greenwald, Judy

Byline: Judy Greenwald Royal Indemnity Co., a major part of Royal & SunAlliance USA Inc.'s operations, which are now in runoff, has a potential reserve shortfall of nearly $1 billion, according to a special policyholder report. Policyholders are protesting an agreement under which Charlotte, N.C.-based Arrowpoint Capital Corp., a vehicle established by RSA USA's management team, will acquire Royal Indemnity Co.

and other members of RSA USA's insurance pool from their London-based parent, Royal & Sun Alliance Insurance Group P.L.C. The $300 million deal is a deferred compensation arrangement that will be funded by the U.S. operation's future performance. While RSA said it will contribute $287.5 million of additional capital to the U.S. operation upon...

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