Oct. 19--The property-casualty insurance businesses of GMAC Inc., including its local operations in Winston-Salem, are being sold to an investment group.

The principal buyer is American Capital Acquisition Corp., which is buying GMAC's U.S. consumer property and casualty-insurance business. The terms of the deal were not immediately disclosed.

American Capital's deal is being funded in part by a 25 percent investment in that company by AmTrust Financial Services Inc. That investment is valued initially at $42.5 million over three years.

In a regulatory filing, AmTrust said that American Capital was formed by the Michael Karfunkel 2005 Grantor Retained Annuity Trust. Karfunkel is the chairman of AmTrust and controls the trust.

Hilly Gross, a spokesman for AmTrust, said that the intention of both groups is to keep the GMAC Personal Line operations in Winston-Salem and the bulk of local management and employees intact.

Gross said that American Capital and AmTrust are involved in a joint venture regarding the GMAC property-casualty insurance business.

AmTrust sells specialty-property and casualty-insurance products, including workers' compensation, commercial automobile and general liability, extended service and warranty coverage.

Neither local nor corporate GMAC officials had immediate comment on the transaction.

However, in a regulatory filing, GMAC said that the deal followed "a comprehensive strategic review of GMAC's broader insurance business, which includes GMAC's U.S. automobile, commercial vehicle, motorcycle and recreational vehicle insurance offerings."

GMAC said that the dealer-related insurance business, which includes extended service contracts and insurance for auto dealer inventories, is not affected by this transaction.

The acquisition is subject to regulatory approval and is expected to close in the first quarter.

The personal-lines division has about 905 employees locally after experience two jobs cuts this year. Those jobs were eliminated as part of the division's effort "to better align its resources with business needs," spokeswoman Sarah Comstock said earlier this year.

Barry Zyskind, the president and chief executive of AmTrust, said that the company's participation in the GMAC deal provides strong strategic advantages.

"Primarily, it provides us immediate access to a new distribution force of 10,500 agents that will be equipped to cross sell our AmTrust products," Zyskind said.

"Additionally, this investment will generate substantial fee income for AmTrust, from both the development of our unique information-technology platform and for asset-management services, as well as generate underwriting profits through the contemplated reinsurance agreement."

GMAC's consumer property and casualty insurance business is one of the leading writers of automobile coverage through independent agents in the United States.

It had a net written premium of more than $1 billion in 2008.

The personal-lines division was sold in November 2006 as part of General Motors Corp.'s sale of 51 percent of GMAC Financial Services to a consortium of investors led by Cerberus FIM Investors LLC, a private-investment company based in New York.

At that time, GMAC had 1,179 local employees.

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