CMIC's plan of conversion obtains approval from policyholders

Wed. June 10, 2009; Posted: 09:44 AM

Jun 10, 2009 (Datamonitor via COMTEX) -- DCAP | Quote | Chart | News | PowerRating -- US-based DCAP Group has announced that the Commercial Mutual Insurance Company's, or CMIC, plan of conversion, providing for a conversion of CMIC from an advance premium co-operative to a stock property and casualty insurance company, was approved by CMIC's policyholders.

The plan provides that, upon the effectiveness of the conversion, DCAP will receive a 100% equity interest in CMIC upon conversion of its $3.75 million principal amount of surplus notes of CMIC.

In addition, DCAP will forgive all accrued and unpaid interest on the surplus notes as of the date of conversion. Upon conversion, eligible policyholders will share in a distribution of $534,069. The contemplated effective date for the conversion is July 1, 2009.

The name of the new insurance company will be 'Kingstone Insurance Company'. DCAP's name will change to 'Kingstone Companies', which was already approved by its shareholders.

Barry Goldstein, chairman and CEO of DCAP and chairman and chief investment officer of CMIC, said: "We are pleased that the policyholders have approved the plan and we look forward to the conversion of CMIC to Kingstone Insurance Company. Upon the effectiveness of the conversion, we will have implemented a significant step in the reformation of our business model from a retail insurance brokerage operation to the ownership of an insurance company."

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