APRIL 17, 2003 12:00 AM (EDT)
A.M. Best Updates Under Review Status of Bankers Insurance Group
Richard Attanasio - P/C
(908) 439-2200, ext. 5432
Stephen Irwin - L/H
(908) 439-2200, ext. 5454
(908) 439-2200, ext. 5644
(908) 439-2200, ext. 5378
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - APRIL 17, 2003 12:00 AM (EDT)
A.M. Best Co. has updated the under review status of the financial strength ratings of B (Fair) of Bankers Insurance Group, Incorporated's (Bankers) (St. Petersburg, FL) subsidiaries. The rating implications remain negative.
The ratings were placed under review in October 2002 in response to continued deterioration in statutory surplus and elevated holding company financial leverage. This updating of the ratings reflects the signing of a definitive agreement with Fiserv, Inc., regarding the sale of Bankers' majority owned affiliate, Insurance Management Solutions Group. The sale reflects Bankers' ongoing capital raising initiatives in response to strains on capitalization. During 2002, the group sold an affiliated company as well as its servicing rights to the National Flood Insurance Program (NFIP). Despite these sales and subsequent capital infusion, Bankers' capitalization remains vulnerable due to weak operating results and realized and unrealized losses.
While this most recent transaction could potentially stabilize the interim capital position of all the operating companies, uncertainty remains regarding the sustainability of Bankers' surplus and ultimate success of its corrective actions.
The ratings will remain under review pending the close of the transaction and further discussions with management.
The financial strength ratings of B (Fair) have been updated and remain under review with negative implications for the following subsidiaries of Bankers Insurance Group, Incorporated:
- Bankers Insurance Group
- Bankers Insurance Company
- Bankers Security Insurance Company
- Bankers Life Insurance Company
A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source.