A.M. Best Downgrades Ratings of Southern Family and Atlantic Preferred; Ratings Remain Under Review.OLDWICK, N.J. -- A.M. Best Co. has downgraded the financial strength ratings to B (Fair) from B+ (Very Good) of Southern Family Insurance Company, Inc. and its affiliate, Atlantic Preferred Insurance Company (both of Tampa Tampa (tăm`pə), city (1990 pop. 280,015), seat of Hillsborough co., W Fla., a port of entry with an impressive harbor on Tampa Bay; inc. 1855. , FL). The ratings remain under review with negative implications. The rating actions reflect A.M. Best's uncertainty regarding the current financial condition of the companies, as well as their overall strategic direction. The ratings had previously been placed under review on December 28, 2004, reflective Refers to light hitting an opaque surface such as a printed page or mirror and bouncing back. See reflective media and reflective LCD. of deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in risk-adjusted 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. as a result of hurricane activity in 2004 and an elevated loss reserve leverage position relative to surplus. At that time, A.M. Best was advised that management was pursuing a number of strategic initiatives to stabilize stabilize See peg. risk-adjusted capitalization. To date, A.M. Best has not been presented with a recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. plan to improve the capital position of the companies, which would meet the requirements for their current ratings. Therefore, the ratings have been downgraded. The ratings remain under review with negative implications to reflect the current uncertainty regarding year-end 2004 risk-adjusted capitalization. Accordingly, there is a potential for further downward movement in the ratings pending A.M. Best's final analysis. At that time, A.M. Best will make a final rating determination and subsequently, withdraw the ratings as requested in the parent company, Poe Financial Group's press release of February 17, 2005. For Best's Ratings Best's rating A rating A.M. Best Co. assigns to insurance companies based on the company's ability to meet its obligations to its policyholders. , an overview of the rating process and rating methodologies, please visit http://www.ambest.com/ratings. For current Best's Ratings, independent data and analysis on more than 3,000 individual property/casualty companies, groups and industry composites, please visit http://www.ambest.com/pc. 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 http://www.ambest.com. |
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