21st Century Holding to Buy Florida’s HomeWise Insurance

21^st Century Holding Co. has agreed to acquire HomeWise Insurance Co. and HomeWise Management Co. from HomeWise Holdings Inc.

The agreement also includes renewal rights to certain insurance policies from HomeWise Preferred Insurance Co. Terms of the proposed transaction were not disclosed. The proposed transaction is subject to regulatory approval and due diligence. The company expects to close the transaction prior to June 1, 2010.

HomeWise Insurance is based in Tampa and provides homeowners property coverage in Florida and Louisiana through a network of independent agents. It reported approximately $38.2 million in gross written premium in 2009, and statutory surplus of $20.3 million.

Michael H. Braun, 21^st Century Holding’s chief executive officer and president, said HomeWise has a “high quality book of business” and the transaction should yield “substantial, immediate benefits for 21^st Century Holding Co. shareholders.”

He said there are synergies including greater diversification of risk within Florida and into Louisiana, the ability to write more premium for each dollar spent on reinsurance and expense savings from combining the two companies.

Braun said his company believes the deal will generate more than $100 million in annual premium.”

21^st Century Holding Co., through its subsidiaries, underwrites commercial general liability insurance, commercial residential property, homeowners’ property and casualty insurance, flood insurance, inland marine, personal automobile insurance and commercial automobile insurance in Florida. The company underwrites general liability coverage as an admitted carrier in the states of Alabama, Louisiana and Texas. The company is approved to operate as a surplus lines/non-admitted carrier in Arkansas, California, Georgia, Kentucky, Maryland, Missouri, Nevada, Oklahoma, South Carolina, Tennessee, and Virginia and offering the same general liability products.

Last October, Lauderdale Lakes, Fla.-based 21st Century and its board of directors rejected an unsolicited buyout proposal by Florida-only insurer Homeowners Choice, Inc., which sought to acquire all outstanding shares of 21st Century for approximately $5.30 per share or about $40 million.

Based in Tampa, HomeWise provides homeowners coverage and other property insurance products through independent agents. The company has an A Exceptional rating from Demotech.

Last month, HomeWise Insurance Group notified state regulators that it was consolidating operations and would no longer write through HomeWise Preferred.