GE Insurance Solutions Under Review By A.M. Best
NU Online News Service, Feb. 7, 11:36 a.m. EST?A.M. Best Co. has placed the financial strength ratings of various GE Insurance Solutions Corp. units under review with "negative implications," following the company's recent announcement of a significant reserve charge.[@@]
The GE Insurance Solutions units that are affected by The Oldwick, N.J.-based rating firm's action include: Employers Reinsurance Corp., GE Reinsurance Corp., First Specialty Insurance Corp., and Westport Insurance Corp. These subsidiaries currently have "A" financial strength ratings from A.M. Best.
GE Insurance Solutions Corp. is part of General Electric Company, headquartered in Fairfield, Conn.
The ratings firm said its rating action last week follows an initial meeting with General Electric management following GE's recent announcement that GE Insurance Solutions will be taking an additional $472 million after-tax charge in the fourth quarter for adverse reserve development stemming primarily from the 1997-2001 accident years.
This additional charge brings the total after-tax adverse reserve development in 2004 to $750 million, placing further pressure on the group's level of risk-adjusted capitalization, A.M. Best said.
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