Profile: American Safety Insurance Holdings Ltd (ASI.N)

American Safety Insurance Holdings, Ltd. is a specialty insurance and reinsurance underwriter with United States insurance and international reinsurance operations offering solutions for specialty risks. Through the Company's domestic operating subsidiaries and affiliates, the Company markets and underwrites a variety of specialty insurance products to small and medium-sized businesses in the United States. It operates in two segments: insurance operations and other. Its insurance operations consists of three specialty divisions: excess and surplus lines (E&S), alternative risks transfer (ART) and assumed reinsurance. Its Other segment includes lines of business that it has placed in run-off, such as workers’ compensation, excess liability insurance for municipalities, other commercial lines, real estate and other ancillary product lines. Through its Bermuda operating subsidiaries, it offers reinsurance products primarily to the United States and international insurance companies. In March 2012, the Company announced its formation of American Safety UK, Ltd.

Excess and Surplus Lines

E&S consists of seven product lines: environmental, primary casualty, excess, property, surety, healthcare, and professional liability. The Company's E&S business also includes certain products offered by the admitted market. The Company writes portions of its environmental, a portion of its professional liability products and all of its surety business on an admitted basis. The Company's subsidiary, American Safety Casualty Insurance Company (American Safety Casualty), provides coverage in the admitted portion of the E&S market. Its excess and surplus lines products include Environmental, which is a general liability for various types of environmental risks, including smaller market and middle market environmental contractors and consultants and environmental impairment liability.

The Company does not provide coverage for manufacturers or installers of products containing asbestos, but instead may insure the contractors that remediate asbestos. The environmental risks the Company underwrites include Environmental Contractor and Consultant Risks and Environmental Impairment Liability. Environmental contractor and consultant risks is a general contractor pollution and/or professional liability coverage for environmental contractors and consultants. Environmental Impairment Liability is a coverage for fixed site pollution liability businesses, such as manufacturers, real estate, storage tank facilities and waste facilities.

The risks the Company underwrites include Residential Construction, Commercial Construction, Products Liability and Other. Its residential contractors include primarily artisan contractors, subcontractors and general contractors. Products liability includes coverage to small and middle market manufacturers and distributors of medium hazard products, excluding certain high severity classes of risks, such as invasive medical products, pharmaceuticals and nutraceuticals. Others coverages include general liability for building owners and equipment dealers. The Company provides Excess and umbrella liability coverage primarily in the construction and products liability areas, both over other carriers' and the Company's own primary policies. Property and packaged property and liability focused on fire exposed premises for risks such as apartment buildings, condominiums, office buildings and hotels/motels. Surety includes contract performance and payment bonds to environmental contractors and construction contractors in 49 states and the District of Columbia. The Company also underwrites commercial surety bonds.

Healthcare includes general and professional liability for the long-term care industry, including nursing homes and assisted living facilities. Professional Liability includes coverage for primary and following-form excess directors and officers liability for public, private and non-profit entities; stand alone employment practices liability insurance (EPLI), and fiduciary liability. It also includes primary and excess coverage for miscellaneous professional liability risks, such as lawyers and insurance agents.

Alternative Risk Transfer

The Company's participation in the ART market takes two forms: as a fully funded carrier and by underwriting in specialty programs. The Company serves as a fully funded carrier for risks that wish to essentially self-insure for which the Company receives fee income. The Company also underwrites specialty program business in which the Company outsources the underwriting and policy administration to programs managers with established underwriting in the particular homogenous risk covered by the program.

Working through third-party program managers, the Company targets homogenous groups of specialty risks where the principal insurance coverages include either liability (general, professional or pollution liability) or property risks. The Company's specialty programs consist primarily of property and liability coverages for construction contractors, pest control operators, auto dealers, real estate brokers, restaurant and tavern owners and bail bondsmen. The Company's insureds are required to maintain insurance coverage to operate their business and the fully funded product allows these insureds to provide evidence of insurance. The Company writes fully funded general and professional liability policies for businesses operating primarily in the healthcare and construction industries.

Assumed Reinsurance

The Company's subsidiary, American Safety Reinsurance, Ltd., focuses on treaty reinsurance for captives, risk retention groups and specialty insurance companies. Lines of business written include medical malpractice, general liability across multiple sectors, commercial automobile liability, professional liability, workers compensation and one property catastrophe treaty that provides a finite limit over the exposure period. Business is sourced from a combination of London, United States and Bermuda based reinsurance brokers. The portfolio is a spread of smaller treaties across multiple lines of business written on both an excess of loss and quota share basis.

Runoff Lines

The Company's Runoff Lines includes Workers’ Compensation and Excess Liability Insurance for Municipalities. It began writing workers’ compensation insurance for environmental contractors.

The Company competes with RLI Corp., Navigators Group, Meadowbrook Insurance Group, W.R. Berkley Corporation, Markel Corporation, Houston International Insurance Group, Philadelphia Insurance Company, Alterra Corporation, Wind River Reinsurance Company and Lloyds of London.