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Video Broadcast “EICN, Do You Take Fremont Comp to be Your Wholly Owned Subsidiary?” Runtime 3:13 Real Media 56k | Broadband Windows Media Player 56k | Broadband Quicktime 56k | Broadband

Much like a high profile Hollywood wedding, the cat is now officially out of the bag on the Employers Insurance Company of Nevada (EICN) and Fremont Compensation Insurance Group (Fremont) marriage. For good measure officials waited three days to let the ink dry on the agreement before they opened up to the press. But as Fremont had hoped for, its suitor, the gentleman caller EICN said, “I do,” and consummated the arrangement July 1.

The union adds to EICN’s estate that was once just limited to Nevada. EICN now possesses all the renewal rights to the ongoing book of workers' compensation business held by Fremont Comp, with policies in California, Idaho, Utah, Montana, and Colorado. Now that EICN is in charge, Fremont will shed its maiden name and now be known as Fremont Employers Insurance Company, Inc., a wholly owned stock subsidiary.

“I am very pleased to announce the completion of this transaction, which marks the continuing evolution of EICN as a Western regional leader in workers' compensation insurance," said Phillip C. Peckman, chairman of the board of EICN. “For policyholders in California and other states where we now offer coverage, this acquisition brings the benefit of doing business with a stable, successful and experienced workers’ compensation company.”

In 2001, EICN's annual policy revenue was approximately $120 million. The company expects revenues to double with the acquisition of the Fremont business.

Approximately 240 Fremont employees will join EICN, including five senior officers. Douglas Dirks retains his current positions as EICN President and Chief Executive Officer.

Fremont President Mary-Lou Misrahy becomes Chief Operating Officer and Executive Vice-President; John Donaldson will be EICN's Chief Financial Officer and Executive Vice-President; Richard Anderson becomes Senior Vice-President, Insurance Operations; Leslie Mallonee assumes the position of Chief Information Officer and Senior Vice-President; and Mary Wilkman becomes Senior Vice-President, Human Resources and Administration.

Ann Nelson will serve as EICN's Chief Administrative Officer, Executive Vice-President, and Director of Government Affairs, and Lenard Ormsby will serve as the company's General Counsel and Executive Vice-President.

Dirks said that EICN enters the California market at an opportune time.

“Every indication is that the California market is rebounding, therefore we believe that our acquisition of the Fremont business will provide a stable revenue base that benefits all of our policyholders,” he said. “Expansion of our business is a natural part of EICN's ongoing evolution and continued success.”

Before the transaction could be completed Fremont General had to reach a definitive agreement with the California Department of Insurance, under the terms and conditions as outlined in the Company's Form 10-Q for the quarterly period ended March 31, 2002. The deal struck with regulators allows Fremont General to self-administer the run-off of its workers' compensation insurance policies currently in force and preserves the company's net operating loss carryforwards attributable to its discontinued workers' compensation insurance subsidiary.

This marks the end of a critical chapter in Fremont Compensation history. So far the holy matrimony looks like a win win for all involved. Claims adjusters get to keep their jobs. EICN can now expand its horizons. The state even though it loses one, it picks up a fresh new carrier unjaded by recent California sized losses. And with Fremont Compensation out of the house Fremont General can now focus on it moneymaking financial segment.