Timeline and Process Highlights
- February 2025: Plan first submitted to the Division for review.
- March 2025: Division retained Attorney J. David Leslie to participate in the Working Group review.
- July 21, 2025: Applicants submitted the final version of the plan.
- August 5, 2025: Applicants and Working Group jointly moved for approval of policyholder materials, distribution plan, and voting procedures.
- August 11, 2025: Presiding Officers issued an order approving the requested materials and procedures.
- August 12, 2025: Hearing notice issued for October 21, 2025, to be held virtually via TEAMS.
- October 21, 2025: Public hearing held.
- November 20, 2025: Special policyholder meetings scheduled for the required member votes.
- December 18, 2025: Decision and Order issued approving the transaction.
How the reorganization will work
On December 22, 2025, the Massachusetts Division of Insurance announced that it has approved a multi-step corporate reorganization of The Merrimack Mutual Fire Insurance Company and Cambridge Mutual Fire Insurance Company. The two companies — both Massachusetts domestic mutual insurers— will be reorganized into stock issuance companies owned through intermediate holding companies by mutual holding companies, followed by a merger into The Andover Companies, Inc., a newly formed Massachusetts mutual holding company.
The approval, issued Dec. 18, 2025, follows a Division of Insurance review that began when the plan was first submitted in February 2025 and culminated in a public hearing held virtually on Oct. 21, 2025, under M.G.L. c. 175, §§ 19F et seq. and 19S. After conclusion of the hearing and a review of the testimony and documents, the Division of Insurance Hearing Officers issued an approval under § 19H(d).
Merger step (after reorganizations):
Under the plan, Merrimack and Cambridge will each form an intermediate stock holding company—Merrimack Insurance Intermediate Holding Company and Cambridge Insurance Intermediate Holding Company—then convert into stock issuance companies. Two mutual holding companies will also be incorporated: The Andover Companies, Inc. and Cambridge Mutual Insurance Holding Company. Upon conversion, the policyholder membership interests in the mutual insurers will be extinguished and replaced with membership interests in the respective mutual holding companies.
The plan then calls for the mutual holding companies and intermediate holding companies to merge. Cambridge Mutual Insurance Holding Company will merge into The Andover Companies, Inc., with The Andover Companies, Inc. as the surviving entity. At the same time, Cambridge Insurance Intermediate Holding Company will merge into Merrimack Insurance Intermediate Holding Company, leaving Merrimack’s intermediate holding company as the survivor. Membership interests in Cambridge Mutual Insurance Holding Company will be extinguished and replaced with membership interests in The Andover Companies, Inc.
Ultimately, the mutual holding companies will be capitalized via their respective stock issuance companies.
The Case for Reorganization
A central theme underpinning the petition for reorganization was strategic flexibility.
Charles DiGrande, president and chief executive officer, testified during the hearing that the companies are Massachusetts-domiciled mutual insurers headquartered in Andover and operating as part of a family of companies known as the Andover Companies. He stated that the companies’ boards and management have been evaluating their strategic position amid changes in the property-casualty marketplace, including new underwriting methodologies, new data sources and analytical tools, new technologies aimed at preventing or mitigating losses, and evolving distribution channels.
In particular, he noted that while the Applicants have no “current or anticipated need for additional capital”, the current structure of mutual insurers naturally have “limited options for raising capital”, particularly when pursuing mergers, acquisitions, or investments, since they cannot use stock as acquisition “currency.”
During the hearing, company leadership also said it considered remaining mutual, as well as considering full demutualization, before opting for the mutual holding company approach. DiGrande testified that a full demutualization, absent a new mutual holding company, would have deprived policyholders of their ownership interests and shifted ownership to stockholders.
Kevin J. Ouelette, vice president, secretary and general counsel noted that he had been involved in the discussions about a reorganization of the mutual insurers since 2023. During the hearing, he described the transaction as a multi-step reorganization followed by a merger intended to simplify the enterprise’s existing structure.
He testified that the companies operate under a “unique structure” in which Merrimack, Cambridge and their subsidiary Bay State Insurance Company share common management and operate under a pooling arrangement. Ouelette said the arrangement can create inefficiencies and redundancies in governance and administration and is “less than optimal” for structural efficiency and tax planning.
Ouelette testified that the reorganizations “will in no way annul, modify or change” existing suits, rights, property interests, contracts or liabilities. He and other company witnesses said policyholder contract rights and benefits will be unchanged, with coverage, premiums and other policy terms continuing as before, except that the coverage will be provided by a stock insurer rather than a mutual insurer. He also testified that the companies have no current or anticipated need for additional capital, but that a mutual holding company structure would provide more options for financing and acquisitions in the future.
The Andover’s financial picture portrayed during the hearing
Amy L. DiPerna, vice president and treasurer, testified that as of Dec. 31, 2024, Merrimack had capital and surplus in excess of $1.8 billion and approximately $2.7 billion in net admitted assets, while Cambridge had capital and surplus in excess of $890 million and approximately $1.5 billion in net admitted assets. As of June 30, 2025, she said Merrimack’s capital and surplus exceeded $1.9 billion and Cambridge’s exceeded $927 million.
She also noted that the Andover Companies are one of the largest and longest-standing mutual insurance groups in the Northeast with the companies having retained their AM Best “A” Rating or higher, since 1940.
Continuing in her testimony, DiPerna emphasized that the plan does not provide for any sale of stock—voting or nonvoting—or the issuance of debt securities to outside investors, and she said the companies have no plans for such offerings. She testified the reorganizations and mergers are not expected to negatively affect financial strength and could improve the companies’ ability to raise capital if unexpected events later placed significant stress on the insurers. She also testified that she concurred with both Mr. DiGrande and Mr. Oulette’s testimony that the proposed reorganizations and mergers “will have absolutely no impact on insurance coverage the Companies provide to their policyholders, other than the fact that it will be provided by a stock, rather than a mutual, insurer.” Rather, she stated she believed the proposed reorganization will strengthen the Companies’ financial position.
The Division of Insurance’s Review
The Division’s review included a Working Group made up of Division staff and consultants. Jean F. Farrington, Esq., and Matthew A. Taylor, Esq., were appointed as presiding officers for the required hearing. Attorney J. David Leslie, a shareholder at Davis, Malm and D’Agostine, P.C., testified on behalf of the Working Group that the application materials complied with statutory content requirements and that the participants complied with procedures in the mutual holding company statute and applicable regulations.
Leslie testified that, in the Working Group’s view, the transactions are in the best interests of the applicants, are expected to provide greater operating flexibility while maintaining mutuality, and will not substantially lessen competition because the reorganized companies will continue their current lines of business and are already affiliates under the same management. He also testified that the companies are well-capitalized and that the reorganizations provide for paid-in capital stock at least equal to the minimum required for a new domestic stock insurer.
The Working Group also reviewed policyholder voting procedures. Mark Noller, a principal at Rudmose & Noller Advisors, LLC, testified that the firm was asked to perform agreed-upon procedures related to identifying eligible members and overseeing processes for member voting, including the printing, assembly and mailing of materials handled with vendor Equiniti Trust Company LLC. He testified the procedures appeared reasonable and sufficient and that no exceptions were identified.
The DOI’s Findings Under M.G.L. c. 175 § 19H(d)
The decision states that the Commissioner’s approval standard required findings that the plan is in the best interests of the reorganizing insurer, fair and equitable to policyholders, enhances operations, does not substantially lessen competition, meets required minimum paid-in capital and surplus standards, and complies with the mutual holding company law set out in §§ 19F through 19W. The presiding officers concluded the transaction met those standards and approved the plans pursuant to §19H9d).
The official decision by the Massachusetts Division of Insurance
For those individuals interested in reading the official decision, a copy is provided below. It also can be accessed on the Division of Insurance website here.
