Ratings Roundup: Westchester Fire, Middle Georgia

A.M. Best Co. has withdrawn the financial strength rating (FSR) of ‘A+’ (Superior) and issuer credit rating (ICR) of “aa-” of New York-based Westchester Fire Insurance Company (WFIC) and assigned an NR-5 (Not Formally Followed) to the FSR and an “nr” to the ICR. Best noted that effective January 1, 2011, WFIC was merged into an affiliate company, Philadelphia-based ACE Indemnity Insurance Company, both of which are indirect wholly owned subsidiaries of ACE Limited; Best said the FSR of ‘A+’ (Superior) and ICR of “aa-” of ACE Indemnity “are unchanged as a result of this legal entity merger. However, subsequent to the merger, the name of ACE Indemnity was changed to Westchester Fire Insurance Company. The sole purpose of this merger was to relocate WFIC from New York to Pennsylvania in order to simplify and streamline business processes.”

A.M. Best Co. has placed under review with negative implications the financial strength rating (FSR) of ‘B++’ (Good) and issuer credit ratings (ICR) of “bbb” of Middle Georgia Group and its member, Middle Georgia Mutual Insurance Company. Best said the rating actions “stem from Middle Georgia’s agreement to affiliate with Buckeye State Mutual Insurance Company through a reinsurance pooling agreement.” Best added that the “negative implications reflect the fact that Buckeye’s current FSR is ‘B+’ (Good) and ICR is “bbb-“, and it will hold the majority of Middle Georgia’s board of directors. The agreement is contingent upon regulatory approvals, with an expected closing date by March 31, 2011.” The ratings will remain under review until the closing date and upon Best’s completion of a full evaluation of the reinsurance pooling agreement.