A.M. Best Co. has downgraded the financial strength rating of First American Title Insurance Group and its member companies from “A (Excellent)” to “A-minus (Excellent).”
The move was made because of concern over the Santa Ana, Calif.-based carriers' overall capitalization following an approximately $325 million drop in statutory surplus reported at the end of 2007.
Best said the surplus decline was due to a significant increase in nonadmitted intercompany receivable and goodwill resulting from the carrier's intended plan to spin off its financial services companies into a separate company to be called First American Financial Corporation.
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