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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - APRIL 09, 2009 12:00 AM (EDT)
A.M. Best Co. has revised the outlook to positive from stable and affirmed the financial strength rating of B+ (Good) and issuer credit rating of "bbb-" of North Sea Insurance Company (North Sea) (Long Beach, NY).
The ratings reflect North Sea's solid risk-adjusted capitalization and improved operating and underwriting results in recent years, driven by various corrective actions, including enhanced systems to monitor, track and price risks. The ratings also take into account the recent acquisition of North Sea by Lancer Financial Group, Inc., which may lead to future synergies; however, North Sea's operating personnel and near-term business plans remain essentially unchanged.
These strengths are offset by North Sea's historically high expense ratio, pockets of modest adverse loss reserve development and the challenges associated with being geographically concentrated in the New York metropolitan region, which exposes the company to a highly litigious environment and catastrophic events, both natural and man-made.
The positive outlook is supported by the company's risk-adjusted capital position, improved profitability and A.M. Best's expectation that these trends will continue over the near term.
For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit Best's Ratings & Analysis.
The principal methodologies used in determining these ratings, including any additional methodologies and factors, which may have been considered, can be found at Best's Credit Rating Methodology.
Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers.