PMA Capital Corp. of Blue Bell said today that state regulators have approved the sale of its reinsurance unit, PMA Capital Insurance Co.
The buyer is Armour Reinsurance Group Ltd., which paid $100,000. Reinsurance is insurance for insurance companies.
As part of the deal, Armour will receive $13 million from PMA Capital to help run the unit's remaining operations. The payment consists of $3 million in cash now and two $5 million notes, one payable next year and the other in 2013.
PMA Capital Insurance in 2003 was placed "in run-off" by the Pennsylvania Insurance Dept., meaning the unit could not write any new policies but could continue to service existing policies.