The Andover Companies have completed a major restructuring, officially changing to a mutual holding company (MHC) setup as of January 1, 2026. This move was approved by the Massachusetts Division of Insurance and supported by policyholders of both Merrimack Mutual Fire Insurance Company and Cambridge Mutual Fire Insurance Company.
Under the new structure, Merrimack Mutual and Cambridge Mutual shifted from mutual insurers to stock insurance companies. They have been renamed Merrimack Insurance Company and Cambridge Insurance Company and now operate as wholly owned subsidiaries under a newly formed intermediate holding company called Merrimack Insurance Intermediate Holding Company.
Charles DiGrande, president and CEO, explained during a regulatory hearing that the change comes after the boards and management reviewed how the companies fit in today’s property-casualty market. They considered new ways of underwriting, data tools, loss prevention technology, and shifts in how they reach customers. While the companies do not currently need more capital, DiGrande pointed out that mutual insurers generally face limits when raising funds because they can’t use stock to make deals or investments.
This switch reflects wider industry trends where having flexible access to capital is becoming more crucial. A recent Morningstar DBRS report highlighted that insurers who can tap into multiple funding sources tend to be stronger financially and more competitive. For context, in 2024, U.S. insurers held $217 billion in funding agreement-backed notes and $161 billion in financing from the Federal Home Loan Bank, both record highs.
Kevin J. Ouelette, vice president, secretary, and general counsel, noted that before the change, the companies operated under a unique but less efficient setup. Merrimack, Cambridge, and their subsidiary Bay State Insurance Company shared management through a pooling system, which had drawbacks for structural and tax planning. He reassured that the reorganization would not affect any ongoing legal matters, contracts, or obligations.
Importantly, policyholders who were members before will automatically become members of the new mutual holding company, keeping their membership rights intact.
Overall, the move aims to give Andover Companies more financial flexibility and improve their position for future opportunities while maintaining the benefits for their policyholders.