NEW YORK (AP) - PMA Capital Corp. agreed to sell a book of insurance policies that went into run-off - or policies in lines of business the insurer no longer underwrites - for $20 million, the company said.

PMA Capital has reinsurance and excess and surplus insurance businesses that went into runoff in 2002 and 2003. When a line of business goes into run-off, the company stops writing new policies and manages the existing book of business.

The company has been trying to sell this book since November. Late on Tuesday, PMA Capital said it agreed to sell the book to Armour Reinsurance Group Ltd., a Bermuda-based subsidiary of Brevan Howard P&C Master Fund Ltd.

Armour agreed to pay $10 million in cash plus a $10 million IOU, which is subject to adjustments based on future losses on the acquired policies.

The deal is subject to approval by the Pennsylvania Department of Insurance. Keefe, Bruyette & Woods was financial adviser to PMA in this deal.