A.M. Best Assigns Rating to Nationwide Mutual's New Surplus Note.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--March 20, 2003 A.M. Best Co. has assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. an "a" rating to the $300 million 7 7/8% surplus note, due 2033 issued by Nationwide Mutual Insurance Company Nationwide Mutual Insurance Company & Affiliated Companies is a group of large U.S. insurance and financial services companies based in Columbus, Ohio. History Beginnings as Farm Bureau Mutual . The financial strength rating of A+ (Superior) of the primary property/casualty company of the Nationwide Group (both located in Columbus, OH) is unaffected; however, the negative outlook placed on the debt and financial strength ratings in 2001 remains in effect. The debt ratings of Nationwide 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. , Inc., and the financial strength ratings of its main operating insurance companies are unaffected. Proceeds from the surplus note issuance will be used to support policyholder's surplus in its property/casualty operations and repay the amounts due on the 6.5% surplus note due February 2004. Given its equity consideration, Nationwide Group's capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. remains supportive of its current ratings, and as stipulated in the documentation, A.M. Best expects the payment of interest from policyholders' surplus on the surplus note will continue to be replenished from earnings. The debt rating is supported by Nationwide's strong capitalization, the value of the Nationwide franchise and its market leadership within the property/casualty industry. These rating factors are derived from Nationwide's overall market knowledge, customer loyalty and efficient cost structure. Finally, the rating takes into account the diversified diversified (di·verˑ·s earnings stream provided through dividends from affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. that include Nationwide Financial Services, Inc., and Gartmore Investment Management, plc, Nationwide Mutual's asset management operations. The negative outlook on the property/casualty debt and financial strength ratings relates to A.M. Best's concern regarding Nationwide's historically modest operating performance and above average investment leverage, which contributed to the decline in policyholder Policyholder An individual who owns an insurance policy. surplus. However, A.M. Best does acknowledge the improving operating trends from Nationwide's underlying book. Nationwide has built a dominant position in the personal lines property/casualty market with a growing presence in the life/retirement savings field. It ranks as the fourth-largest domestic property/casualty insurance company and is a major player in the United States' life and annuity annuity: see insurance. annuity Payment made at a fixed interval. A common example is the payment received by retirees from their pension plan. There are two main classes of annuities: annuities certain and contingent annuities. business. For a comprehensive list of Nationwide's debt and financial strength ratings, please visit http://www.ambest.com/press/032003nationwide.pdf. 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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