A.M. Best Affirms Ratings of United America Indemnity, Ltd. and Its Subsidiaries.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating (FSR (Free System Resource) In Windows 3.x, the amount of unused memory in various 64K blocks reserved for managing current applications. Every open window takes some space in this area. See Windows memory limitation. ) of A (Excellent) and issuer credit ratings (ICR (Intelligent Character Recognition or Image Character Recognition) The machine recognition of hand-printed characters as well as machine printing that is difficult to recognize. ) of "a" of Wind River 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. Company, Ltd. (Wind River Re) (Hamilton, Bermuda) and its U.S. subsidiaries. A.M. Best also has affirmed the ICR of "bbb" of the parent holding company, United America Indemnity, Ltd. (UAI UAI Unprotected Anal Intercourse UAI University Admissions Index (NSW/ACT, index needed by HS Graduating students in order to enter university) UAI Union Académique Internationale UAI Use As Is UAI Universal Armament Interface ) (George Town, Cayman Islands George Town, Grand Cayman, is the capital of the Cayman Islands, in the British West Indies. The town has a population of 20,626 (1999 estimates). George Town is the heart of the Cayman Islands financial industry, with over 600 banks located there. ) (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 : INDM INDM Instant Nonfat Dry Milk ). The outlook for all ratings is stable. (See below for a detailed listing of the companies and ratings.) These ratings reflect the strong capitalization and diversified portfolio of specialty products provided on both an admitted and non-admitted basis by Wind River Re and its U.S. subsidiaries. The ratings also reflect the historical profitability of the U.S. subsidiaries, which began operating under a single pooling agreement as of January 1, 2009, whereby they pool their premiums and liabilities and cede 50% of the combined net retained liabilities to Wind River Re. The ratings of the former, separate United National Group and Penn-America Group have been withdrawn. Wind River Re also has been slowly building a book of unaffiliated, third-party reinsurance business to complement the affiliated business. At the end of 2008, on a gross basis, the third-party business comprised less than 10% of the company's total written premium, with that proportion expected to grow in 2009. These positive rating factors are tempered by the unprofitable operating results of 2008, when a sizeable underwriting loss combined with investment related losses spurred by the substantial financial market downturn, produced a substantial operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. . The underwriting losses primarily were caused by the unfavorable impact of certain run-off classes of program business, along with property catastrophe losses, specifically from Hurricane Ike. Despite a high quality portfolio predominantly comprised of traditional fixed income securities and to a far lesser extent, common and preferred equities, the overall financial market downturn impaired returns as considerable realized and unrealized losses were reported. On a combined basis, written premium for the U.S. operations decreased by nearly 35%, which had a negative impact on underwriting profitability; however, some of the decrease resulted from the planned discontinuation dis·con·tin·u·a·tion n. A cessation; a discontinuance. Noun 1. discontinuation - the act of discontinuing or breaking off; an interruption (temporary or permanent) discontinuance of relationships with agents and brokers that had been producing unsatisfactory results. The effort to develop and cultivate more fruitful and mutually beneficial Adj. 1. mutually beneficial - mutually dependent interdependent, mutualist dependent - relying on or requiring a person or thing for support, supply, or what is needed; "dependent children"; "dependent on moisture" relationships with its distribution force was a major initiative for UAI in 2008 that along with other significant re-engineering and re-structuring initiatives, is expected to positively impact underwriting and operating results in 2009. Failure to return to operating performance levels more in line with historical results would likely result in negative rating pressure on UAI and its subsidiaries. The FSR of A (Excellent) and ICRs of "a" have been affirmed for Wind River Reinsurance Company, Ltd. and its following subsidiaries: * Diamond State Insurance Company * Penn-America Insurance Company * Penn-Patriot Insurance Company * Penn-Star Insurance Company * United National Casualty Insurance Company * United National Insurance Company * United National Specialty Insurance Company The FSR of A (Excellent) and ICRs of "a" have been withdrawn and a category NR-5 (Not Formally Followed) has been assigned to the FSR and an "nr" to the ICRs of Penn-America Group and United National Group. The following indicative ratings have been affirmed under the universal shelf registration: United America Indemnity, Ltd.-- -- "bbb" on senior unsecured debt Unsecured debt Debt that does not identify specific assets that the debtholder is entitled to in case of default. -- "bbb-" on subordinated unsecured debt -- "bb+" on preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com. |
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