AM Best Places Credit Ratings of The National Security Group, Inc. and Its Subsidiaries Under Review With Developing Implications Following Acquisition Announcement

OLDWICK, N.J.–(BUSINESS WIRE)–AM Best has placed under review with developing implications the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb” (Good) of National Security Fire and Casualty Company (NSFC). AM Best also has placed under review with developing implications the FSR of B++ (Good) and the Long-Term ICR of “bbb” (Good) of NSFC’s affiliated life/health insurer, National Security Insurance Company (NSIC). In addition, AM Best has placed under review with developing implications the FSR of B+ (Good) and the Long-Term ICR of “bbb-” (Good) of NSFC’s wholly owned subsidiary, Omega One Insurance Company, Inc. (Omega). Concurrently, AM Best has placed under review with developing implications the Long-Term ICR of “bb” (Fair) of The National Security Group, Inc. (Wilmington, DE) [NASDAQ: NSEC], the parent holding company. All companies are domiciled in Elba, AL, unless otherwise specified.

The Credit Rating (rating) actions follow the announcement that National Security Group Inc. has entered into a merger agreement under which this group will be acquired by VR Insurance Holdings, Inc. in an all-cash transaction of approximately $41.4 million. This transaction is subject to customary closing conditions, including shareholder and regulatory approvals, and expected to be completed by the second quarter of 2022.

The under review with developing implications status reflects the need for AM Best to assess fully the business strategy, financial and operational impacts on the group as a result of the acquisition. The ratings will remain under review pending the completion of the acquisition and AM Bests’ assessment of post-acquisition rating fundamentals.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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