Eastern Insurance Holdings

Eastern Insurance Holdings, Inc. (EIHI) was a publicly traded insurance holding company that specialized in workers' compensation insurance before its acquisition. The company's main operating subsidiary was Eastern Alliance Insurance Group (EAIG), which was founded in 1997. EIHI's business model focused on providing a range of workers' compensation products and services, distributed through independent insurance agencies.

A significant milestone in the company's history was its acquisition by ProAssurance Corporation, a medical professional liability insurer. The all-cash transaction, valued at approximately $205 million, was announced in September 2013 and finalized on January 1, 2014. The acquisition was a strategic move for ProAssurance to diversify its product offerings by entering the workers' compensation market, particularly leveraging Eastern's strong position in healthcare workers' compensation. Following the acquisition, EIHI became a wholly-owned subsidiary of ProAssurance, but continued to operate under the Eastern brand from its headquarters in Lancaster, Pennsylvania. The existing senior executive team, including President and CEO Michael L. Boguski, remained in place under long-term contracts to execute the ongoing business strategy.

Prior to its acquisition, EIHI had been actively expanding its geographic footprint. In 2007, it entered the Southeast workers' compensation market, including Virginia, North Carolina, South Carolina, and Georgia. By 2012, the company was writing policies in 16 states across the Southeast, Midwest, and Mid-Atlantic regions and saw its direct written premium grow by 17.5% to over $180 million. In 2010, as part of a strategic decision to focus more intensely on its high-margin workers' compensation business, EIHI sold its group benefits insurance subsidiary, Eastern Life and Health Insurance Company (ELH), to Security Life Insurance Company of America.

Eastern's product offerings centered on managed care workers' compensation. This included various plans tailored to different business sizes, such as guaranteed cost plans, loss-sensitive dividend plans, retrospective rating plans, and large deductible plans. The company also offered a pay-as-you-go premium option called ParallelPay® to improve cash flow for its clients. A key part of its business involved alternative market solutions through its Cayman-domiciled segregated portfolio cell reinsurance company, Eastern Re Ltd., which offered programs for individual companies and groups to assume a portion of their risk. Additionally, its subsidiary Employers Alliance, Inc. provided fee-based property and casualty claims administration and risk management services to self-insured employers and other insurers.

Keywords: workers' compensation insurance, casualty insurance, property and casualty, reinsurance, claims administration, risk management, alternative risk transfer, segregated portfolio company, medical professional liability, insurance holding company, ProAssurance, Eastern Alliance Insurance Group, Michael Boguski, managed care, large deductible plans, retrospective rating plans, pay-as-you-go insurance, third-party administrator, insurance acquisition, specialty insurance