Palomar completes Gray Surety acquisition and closes $450 million credit facility

Palomar has completed its acquisition of The Gray Casualty & Surety Company, expanding its presence in the surety market and adding a national carrier to its specialty insurance platform. The transaction closed effective January 31, 2026.

Alongside the acquisition, Palomar closed a new $450 million unsecured credit facility, consisting of a $150 million revolving credit line and a $300 million term loan, effective January 27, 2026. The financing was led by U.S. Bank and KeyBank, with participation from a broad syndicate of major U.S. banks.

According to Palomar, the Gray Surety acquisition strengthens its surety franchise by adding scale, geographic reach, and an experienced management team, and aligns with the company’s broader Palomar 2x strategy to build market leadership across specialty lines. Gray Surety now joins Palomar’s portfolio of insurance and reinsurance subsidiaries, all of which carry an A (Excellent) financial strength rating from A.M. Best.

The deal marks another step in Palomar’s expansion beyond property-focused specialty lines into casualty and surety, supported by additional balance sheet flexibility from the new credit facility.