EGI Financial Holdings Inc. today announced the acceptance by AssuranceAmerica Insurance Company (AAIC) of Echelon’s authorization to underwrite 17.6% of AssuranceAmerica’s 2007 quota share reinsurance treaty.

A wholly owned subsidiary of AssuranceAmerica Corp., AAIC provides property and casualty insurance to the non-standard private passenger automobile segment of the industry. The company currently operates directly or through managed insurers in Georgia, South Carolina, Alabama, Florida, Texas and Louisiana, receiving business through both independent and owned retail agencies. AAIC retains 30% of gross premiums written and reinsures 70% of the premiums and losses associated with the business, with highly rated reinsurers, pursuant to the quota share treaty.

Under the reinsurance agreement, Echelon has agreed to accept a maximum of US$15 million of non-standard automobile premiums in 2007 (the first year of the new treaty). The treaty has an initial term of two years and continues for annual periods thereafter unless terminated by either party. The ceding commission and other treaty terms accepted by Echelon have been negotiated between AAIC and its domestic lead reinsurer, a non-standard automobile reinsurance specialist, rated A- (Excellent) by A.M. Best, the leading insurance rating agency.

“Our agreement with AssuranceAmerica marks Echelon’s first move into the United States market, while staying within our specialty auto niche,” said Douglas McIntyre, CEO of both EGI Financial and Echelon. “AssuranceAmerica brings significant underwriting expertise and distribution capability in this market. They are a young, rapidly growing and very well managed organization. This joint venture enables EGI to expand profitably into the U.S. market while mitigating any associated risk.”

“We have been impressed with Echelon’s understanding and responsiveness to our requirements, to provide secure reinsurance coverage to our growing market of non-standard drivers.” said Bud Stumbaugh, CEO of AssuranceAmerica. “Echelon underwrites several other specialty products in Canada, which certainly may be saleable through our distribution channel.”

Founded in 1997, EGI Financial operates in the property and casualty insurance industry in Canada, primarily focusing on non-standard automobile insurance and other niche and specialty general insurance products.