On November 11, 2010, Letters of Intent were signed by parties involved in the outstanding arbitration between Royal Palm Insurance Company and Security First Managers. The transactions contemplated by these Letters will resolve all of the outstanding legal matters between the parties and result in the sale of 100% of the Royal Palm Insurance Company to an affiliate of Tower Hill Insurance Group, LLC. As a result, Royal Palm will commence quoting and writing new policies effective Monday, November 15, 2010. 

While the sale of Royal Palm still requires regulatory approval, officials from the Florida Office of Insurance Regulation were continuously apprised of the status of the ongoing negotiations and they have been made aware of the agreement reached yesterday.  Likewise, representatives of Demotech have also been kept abreast of the developments regarding the settlement negotiations and the sale of the company. 

Royal Palm’s third quarter statutory statement will reflect a policyholders’ surplus in excess of $43.1 million, nearly $900,000 greater than the company’s December 31, 2009 surplus.  The sale of the company to Tower Hill contemplates an additional surplus contribution prior to year end which will further strengthen the company’s balance sheet.  With the acquisition of Royal Palm Insurance Company, the Tower Hill Insurance Group of companies will have over $570 million of in-force residential property premium and $132 million of statutory surplus. 

Tower Hill is excited to bring Royal Palm fully into the fold of Tower Hill companies.  This acquisition will provide you with additional capacity to write residential property throughout Florida.  We hope you are as excited about this news as we are, and we thank you for your patience and understanding during these last several weeks.