CONTACTS:
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - OCTOBER 29, 2008 12:00 AM (EDT)
Based on the considerable credit market contraction and the uncertainty regarding the Florida Hurricane Catastrophe Fund's (FHCF) ability to fund its claims-paying capacity, A.M. Best Co. has placed several insurers' ratings under review with negative implications. (See below for a detailed listing of the companies.)
These rating actions are a follow-up to a press release issued October 15, 2008, in which A.M. Best reiterated its concerns with the uncertainty associated with the contingent capital nature of the FHCF. These concerns have been exacerbated by the considerable credit market contraction and the recently announced revision in the FHCF's claim-paying capacity. A.M. Best continues to assess the impact on rated entities' risk-adjusted capitalization, based on the reduction in the potential coverage available from the FHCF. As a result, despite near completion of the 2008 hurricane season, several rated entities have been put under review with negative implications. It is anticipated that the ratings will remain under review through the completion of the 2008 hurricane season. A.M. Best will then re-evaluate the ratings based on discussions with management concerning their catastrophe risk management practices. As a result, the ratings may likely be affirmed, while the outlooks will be assessed, barring any significant hurricane occurring in the interim, which would have a material adverse impact on the entities' risk-adjusted capital position.
The following rated entities have been placed under review with negative implications:
- Allstate Floridian Insurance Group
- Argus Fire & Casualty Insurance Company
- Omega Insurance Company
- Safeway Property Insurance Company
- Tower Hill Preferred Insurance Company
- Tower Hill Prime Insurance Company
- United Automobile Insurance Group
For Best's Ratings, an overview of the rating process and rating methodologies, please visit Best's Rating Center.
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.