A.M. Best Downgrades Rating of Magna Insurance Company; Revises Outlook to Stable.

OLDWICK, N.J. -- A.M. Best Co. has downgraded the financial strength rating (FSR) to B+ (Very Good) from B++ (Very Good) of Magna Insurance Company (Magna) (Gulfport, MS). The outlook for this rating has been revised to stable from negative. Concurrently, A.M. Best has assigned an issuer credit rating (ICR) of "bbb-" to Magna. The outlook for this rating is stable.

The rating downgrade reflects Magna's lack of clear business strategy since its acquisition by its parent, Hancock Holding Company (Hancock Holding) [NASDAQ: HBHC], in late 2003. In light of the rebuilding efforts from Hurricane Katrina and Hancock Holding's commitment to banking activities, the parent is re-evaluating the strategic role of Magna's insurance operations. Magna showed profitability in 2005 and through third quarter 2006 after two years of posting net losses; however, the company's recent profitability has been primarily driven by investment income and reduced surplus strain, as Magna has dramatically limited its business production in recent years.

However, Magna continues to maintain favorable risk-adjusted capitalization as measured by A.M. Best's capital adequacy ratio model. A.M. Best will monitor the company's progress with the expectation that Magna will develop a clear business strategy concerning its credit business lines and as a result, will report more favorable premium and earnings trends in the near term.

For Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

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.