Moody's Investors Service has affirmed the ratings of Liberty Mutual Group Inc. and its subsidiaries following the completion of the company's $6.2 billion acquisition of Safeco Corporation. The rating agency also downgraded Safeco's ratings to align its ratings with Liberty Mutual's.
LMGI's insurance financial strength ratings were affirmed at "A2," and its senior unsecured debt was affirmed at "Baa2."
Moody's said "the affirmation of Liberty Mutual's ratings is based on the completion of the Safeco acquisition, and related financing, in a manner that is consistent with the company's stated plans at the time of announcement, as well as the group's operational and financial performance in the interim, notwithstanding some negative impact from recent hurricanes...and credit turmoil, which Moody's expects will meaningfully impact third-quarter results for Liberty Mutual and, to a much lesser degree, Safeco."
Safeco's insurance financial strength ratings, meanwhile, were lowered to "A2" from "A1," and the senior debt rating was lowered to "Baa2" from "Baa1." Moody's said the downgrade brings Safeco's ratings into alignment with Liberty Mutual's.
The outlook on all long-term ratings remains negative, Moody's said, which is consistent with the negative outlook assigned to Liberty Mutual when the company announced its agreement to acquire Safeco.
The rating agency added that the continuation of the negative outlook "is based on the decrease in Liberty Mutual's financial flexibility and capital adequacy measures that have resulted from the significant use of internal resources to finance the acquisition, as well as by increased leverage to tangible capital as a result of substantial acquisition-related goodwill intangibles."
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.