April 17, 2012—Pennsylvania Insurance Commissioner Mike Consedine on Monday approved the merger application for Harleysville Mutual and Nationwide Mutual insurance companies.
Under terms of the merger, Harleysville Mutual policyholders will become policyholders of Nationwide Mutual. Nationwide Mutual will also acquire all publicly held shares of Harleysville Group’s common stock, according to the Pennsylvania Insurance Department.
The merger agreement states that Nationwide cannot close, re-domesticate or cease business activity from Harleysville’s corporate office, or any other office located in Pennsylvania, for a three-year period without approval from the Pennsylvania Insurance Department. The department said that Harleysville will continue to write business under the Harleysville brand for at least two more years.
The merger proposal was evaluated by the Pennsylvania Insurance Department against a set of statutory standards, including whether the transaction is in the public interest, whether it will lessen competition and whether it would be hazardous to the insurance-buying public. Other standards that the department considered focused on financial solvency, competence, experience, integrity of company management, fairness and reasonableness of changes in business operations, and compliance with state laws.
The Pennsylvania Insurance Department said the new combined entity will have a greater statewide presence, and offer more product selection to consumers.
“Harleysville and Nationwide have complementary product lines, and together the companies offer more choices to policyholders,” Consedine said. “I also applaud Nationwide’s decision and commitment to preserve the Harleysville culture and to keep jobs here in Pennsylvania.”
The merger agreement will not be officially finalized until it is adopted by a majority vote of Harleysville Mutual members during a special meeting scheduled later this month. The states of Michigan, Ohio and New Jersey must also approve the merger, according to the Pennsylvania Insurance Department.
Harleysville Mutual has more than $355 million in direct written premium, primarily in the Eastern and Midwestern regions of the country. Nationwide Mutual, based in Columbus, Ohio, has direct written premium of more than $3.4 billion.
For more information, visit insurance.pa.gov.
