CONTACTS:
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - MAY 31, 2002 12:00 AM (EDT)
A.M. Best Co. has downgraded the financial strength rating to B++ (Very Good) from A (Excellent) of Overseas Partners Ltd. (OPL) Bermuda, and removed the company from under review. This rating applies to the following subsidiaries: Overseas Partners Re Limited (OP Re), Bermuda, Overseas Partners US Reinsurance Company (OPUS), Delaware and Overseas Partners Assurance Ltd. (OPAL), Bermuda.
In February 2002, A.M. Best placed the rating under review with negative implications as a result of the board of directors' announcement that it would begin an orderly run off of most of OPL's operations with the objective of preserving the value of shareholder investments while supporting liquidity requirements. Since that announcement, the company has retained key senior management positions and has implemented a conservative strategy with regards to supporting its policyholders obligations. Additionally, OPL has sold off its property catastrophe reinsurer, Overseas Partners Cat Limited, to Renaissance Re and has made significant progress in liquidating some of its real estate holdings. Furthermore, management continues to work towards effecting the sale of OPUS and is currently working with an interested party to agree to final terms and conditions.
The rating reflects A.M. Best's view that the overall capitalization of the group with $1.3 billion of shareholders equity is adequate to support the run off of its liabilities, which include $1.7 billion of carried loss reserves. Moreover, OPL's run off plans indicate that it will withdraw capital prudently and maintain shareholders equity at a level that meets or exceeds its carried loss reserve position. A.M. Best will continue to monitor the adequacy of OPL's loss reserves and capitalization.
A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source.