[2] S&P Affirms The Premier Ins. Co. of MA 'BBBpi' Rtg.NEW YORK--(BUSINESS WIRE)--Nov. 24, 1999-- Standard & Poor's today affirmed its triple-'Bpi' financial strength rating on The Premier Insurance Co. of MA. The Premier Insurance Co. of MA is a stock company based in Worcester, MA and licensed only in Massachusetts. It commenced operations in 1993, and its major line of business is automobile insurance. The company is a member of Citigroup Inc., a diversified global financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. organization, and is wholly owned by Travelers Indemnity Co. (financial strength rating double-'A'-minus). Although the company is a member of Citigroup Inc., the rating does not include additional credit for implied group support. Major Rating Factors: -- Capitalization is extremely strong, as indicated by Standard & Poor's capital adequacy ratio Capital adequacy ratio (CAR), also called Capital to Risk (Weighted) Assets Ratio (CRAR)[], is a ratio of a bank's capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss. of 211.3% at year-end 1998. -- Operating performance is good, with the time-weighted return time-weighted return A rate-of-return measure of portfolio performance that gives equal weight to each period included in the study regardless of any differences in amounts invested in each period. on revenue from 1994-1998 at 8.7%. However, the company's volatile returns, with return on assets Return on assets (ROA) Indicator of profitability. Determined by dividing net income for the past 12 months by total average assets. Result is shown as a percentage. ROA can be decomposed into return on sales (net income/sales) multiplied by asset utilization (sales/assets). ranging between minus 4.0% and plus 4.7% since 1994, are a limiting factor A factor or condition that, either temporarily or permanently, impedes mission accomplishment. Illustrative examples are transportation network deficiencies, lack of in-place facilities, malpositioned forces or materiel, extreme climatic conditions, distance, transit or overflight rights, . -- The company has a history of instability in premium revenues. -- The company has a product and geographic concentration with some exposure to catastrophes on a gross basis. Currently, 100% of its net premiums written are in Massachusetts. 'Pi' ratings, denoted with a 'pi' subscript (1) In word processing and scientific notation, a digit or symbol that appears below the line; for example, H2O, the symbol for water. Contrast with superscript. (2) In programming, a method for referencing data in a table. , are insurer financial strength ratings based on an analysis of an insurer's published financial information and additional information in the public domain. They do not reflect in-depth meetings with an insurer's management and are therefore based on less comprehensive information than ratings without a 'pi' subscript. 'Pi' ratings are reviewed annually based on a new year's financial statements, but may be reviewed on an interim basis if a major event that may affect the insurer's financial security occurs. Ratings with a 'pi' subscript are not subject to potential CreditWatch listings. Ratings with a 'pi' subscript generally are not modified with 'plus' or 'minus' designations. However, such designations may be assigned when the insurer's financial strength rating is constrained by sovereign risk Sovereign Risk The risk that a foreign central bank will alter its foreign-exchange regulations thereby significantly reducing or completely nulling the value of foreign-exchange contracts. or the credit quality of a parent company or affiliated group, Standard & Poor's said.---CreditWire |
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