73 Insurers Downgraded In Weiss Review

NU Online News Service, March 5, 9:20 a.m.EST?In its quarterly review of more than 2,200 propertyand casualty U.S. insurers, Weiss Ratings Inc. has downgraded 73companies and upgraded two, while keeping the same ratings for themajority of carriers studied.

The review results were based on data from the end of the thirdquarter in 2002. Weiss will conduct its annual review, which willexamine insurance companies' 2002 year-end figures, in May.

"Companies are seeing results from increasing premiums they havebeen charging. They had an $11 billion profit in the first ninemonths of 2002," said Stephanie Eakins, a financial analyst atWeiss Ratings in Palm Beach Gardens, Fla. "But 32 percent of U.S.p-c insurers still lost money in the first nine months of lastyear."

Among the insurers that suffered big downgrades was AssociatesInsurance Company, based in Irving, Texas, and a member ofCitigroup Inc. In the Weiss review, the company's rating waslowered to "B" (Good) from "A-plus" (Excellent) because ofsignificant decreases in capital and surplus during the 2002 thirdquarter, Ms. Eakins said.

Gerling Global Reinsurance Corporation of America in New Yorkalso saw its rating fall by more than one notch--the company wasdowngraded to "C" (Fair) from "B-minus" (Good) due to a significantdecline in capital since year-end 2001, according to WeissRatings.

Other companies with significant ratings downgrades includeConnecticut Medical Insurance Company in Glastonbury, Conn.;Sterling Casualty Insurance Company in Newport Beach, Calif.; andWashington Casualty Company based in Bellevue, Wash.

On the other side, the two companies that improved their ratingswere Waukegan, Ill.-based Statewide Insurance Company and RapidCity, S.D.-based Sun Surety Company.