A.M. Best Affirms Ratings of Argonaut Group, Inc.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength ratings of A (Excellent) of Colony Insurance Group (Colony) (Richmond, VA), Argonaut Insurance Group (San Antonio San Antonio (săn ăntō`nēō, əntōn`), city (1990 pop. 935,933), seat of Bexar co., S central Tex., at the source of the San Antonio River; inc. 1837. , TX) and Rockwood Casualty Group (Rockwood, PA). Argonaut Insurance Group is comprised of Argonaut Insurance Company (California) and four pooled affiliates. Additionally, A.M. Best has affirmed the financial strength rating of A- (Excellent) of Argonaut Great Central Insurance Company (AGC AGC Automatic Gain Control AGC Automotive Glass Cartridge (fuse) AGC Associated General Contractors AGC Associated General Contractors of America AGC Atypical Glandular Cells AGC Attorney-General's Chambers ) (Peoria, IL) .The outlook for all ratings is stable, except for Argonaut Insurance Group, which has a negative outlook. All of the above companies are subsidiaries of Argonaut Group, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AGII) (San Antonio, TX). The affirmation of Colony's rating reflects its consistently favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. operating profitability and improved market profile. With its focus on underwriting profit Underwriting profit is a term used in the insurance industry. It consists of the earned premium remaining after losses have been paid and administrative expenses have been deducted. It does not include any investment income earned on held premiums. and consistency, Colony maintains a significant loss ratio advantage over its peer surplus lines writers. While A.M. Best is concerned with Colony's overall capitalization in light of moderate adverse loss reserve development and significant growth in recent years, Argonaut Group, Inc. raised a significant amount of capital in 2003 and intends to infuse in·fuse v. 1. To steep or soak without boiling in order to extract soluble elements or active principles. 2. To introduce a solution into the body through a vein for therapeutic purposes. sufficient capital into Colony to support expected future growth. The affirmation of Argonaut Insurance Group's rating reflects the improved operating performance of its continuing business segments. Management has refocused its ongoing risk management segment in more profitable markets, reduced investment leverage, improved claim management operations and produced good accident year operating results over the last few years. However, A.M. Best remains concerned about the continued impact of the Group's discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: legacy business on overall financial results. Adverse loss reserve development related to asbestos and environmental (A&E) and older workers' compensation workers' compensation, payment by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work. reserves continued to be a drag on Verb 1. drag on - last unnecessarily long drag out last, endure - persist for a specified period of time; "The bad weather lasted for three days" 2. earnings in 2003, offsetting the Group's more profitable business again as it has over the previous several years. While the current management team, which started in 2000, has eliminated many of these legacy issues, they continue to be a drag on the financial results of Argonaut Insurance Group. Should this continue in 2004, its rating may be downgraded. The affirmation of Rockwood Casualty Group's rating reflects its strong capitalization, consistently profitable operating performance and good market profile as the leading workers' compensation writer of the Pennsylvania coal mining industry. The affirmation of AGC's rating reflects its improved profitability and its investment portfolio, which is no longer exposed to the volatile equity market. The affirmation also considers the rating of Argonaut Insurance Company, AGC's immediate parent. On the negative side, the company has been rapidly growing due to the expansion of Trident Insurance Services, Argonaut Group, Inc.'s public entity subsidiary whose business is currently written on AGC's paper and whose capital adequacy has deteriorated considerably. However, A.M. Best expects Argonaut Group, Inc. to resolve this capitalization issue via additional internal reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. or a reallocation Noun 1. reallocation - a share that has been allocated again allocation, allotment - a share set aside for a specific purpose 2. reallocation of capital. The financial strength rating of A (Excellent) has been affirmed with a negative outlook for Argonaut Insurance Group and its following affiliates: --Argonaut Insurance Company --Argonaut-Midwest Insurance Company --Argonaut-Northwest Insurance Company --Argonaut-Southwest Insurance Company --Georgia Insurance Company The financial strength rating of A (Excellent) has been affirmed with a stable outlook for Rockwood Casualty Group and its following affiliates: --Rockwood Casualty Insurance Company --Somerset Casualty Insurance Company The financial strength rating of A (Excellent) has been affirmed with a stable outlook for Colony Insurance Group and its following affiliates: --Colony Insurance Company --Colony National Insurance Company --Colony Specialty Insurance Company The financial strength rating of A- (Excellent) has been affirmed with a stable outlook for Argonaut Great Central Insurance Company. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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