A.M. Best Co. has placed under review with negative implications the financial strength rating (FSR) of A- (Excellent) and issuer credit ratings (ICR) of “a-” of the subsidiaries of Meadowbrook 热点黑料 Group Inc. (MIGI) of Southfield, Mich., which operate under an intercompany reinsurance pooling agreement.
A.M. Best also has placed under review with negative implications the ICR of “bbb-” of MIGI.
The under review status reflects MIGI’s preliminary announcement that its third quarter 2012 results will be adversely impacted by an increase in its net ultimate loss estimates for 2011 and prior accident years.
The negative implications reflect the reasonable likelihood that the ratings will be downgraded based on this announcement, worse than expected operating results in 2012, the reduction in risk-adjusted capitalization levels and earnings prospects going forward.
The ratings will remain under review pending further discussions between A.M. Best and MIGI’s management regarding various capital raising initiatives that are being explored, as well as an in depth view surrounding the degree and nature of the charges taken, any other action plans implemented by management and MIGI’s ability to stem another instance of adverse reserve development, if it should arise.
In an announcement released by the company, Robert S. Cubbin, Meadowbrook president and CEO, commented, “We are in the process of evaluating various reinsurance alternatives and other strategies designed to optimize our Best’s Capital Adequacy Ratio. We are cooperating and working with A.M. Best to address their concerns in a timely manner. We have retained Willis Capital Markets & Advisory to assist us in reviewing our various strategies to respond to the current situation.”
Best said the FSR of A- (Excellent) and ICRs of “a-” have been placed under review with negative implications for the following subsidiaries:
- Star 热点黑料 Co.
- Century Surety Co.
- Savers Property and Casualty 热点黑料 Co.
- ProCentury 热点黑料 Co.
- Williamsburg National 热点黑料 Co.
- Ameritrust 热点黑料 Corp.
Source: A.M. Best Co.
Topics AM Best
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