A.M. Best Downgrades and Removes Ratings From Under Review of Converium Insurance and Converium Holdings Both of -North America- Inc.OLDWICK, N.J. -- A.M. Best Co. has downgraded the financial strength rating to B (Fair) from B++ (Very Good) of Converium Insurance (North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. ) Inc. (CINA CINA Children in Need of Assistance CINA Canadian Intravenous Nurses Association CINA Cancer Incidence in North America (publication) CINA Classified Information Nondisclosure Agreement ) (Fort Lee, NJ) following the latest announced business plan by its parent company, Converium AG (Converium) (Switzerland). Concurrently, A.M. Best has downgraded the issuer credit rating to "b-" from "bb-" of Converium Holdings (North America) Inc. (CHNA CHNA Community Health Network Area CHNA Community Health Needs Assessment CHNA Canadian Holistic Nurses Association CHNA College Hill Neighborhood Association CHNA Castleberry Hill Neighborhood Association CHNA Converium Holdings North America ) (Stamford, CT) and the issuer credit rating to "bb" from "bbb" of CINA. A.M. Best has also downgraded the debt rating to "b-" from "bb-"on CHNA's $200 million 7.125% senior notes, due 2023 and originally issued by Zurich 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. Centre Holdings Inc. The ratings have been removed from under review and assigned a negative outlook. The financial strength rating of B- (Fair) and the issuer credit rating of "bb-"of Converium Reinsurance (North America) Inc. (CRNA CRNA Certified Registered Nurse Anesthetist. cRNA complementary RNA. CRNA abbr. ) (Stamford, CT) remain unaffected. The rating downgrades are based on Converium management's plan to cease underwriting at CINA. Converium has indicated that CINA operations will be dormant for the foreseeable future, with no immediate plans of business activity. Earlier, Converium announced that additional capital would not be contributed to CINA as was originally planned. The additional capital injection was intended to support previously planned ongoing U.S. business written through CINA. However, Converium's current plan is to write all future ongoing U.S. business through Converium and its Bermuda branch. The downgrading of CHNA's debt rating is based on Converium's decision to make CINA's operations dormant and place CRNA's operations into runoff. These actions leave CHNA without an actively operating subsidiary An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. to support required interest payments. A.M. Best anticipates that Converium will continue to service CHNA's debt. A.M. Best's financial strength rating for Converium is B++ (Very Good). The negative outlook reflects A.M. Best's opinion that Converium's North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. franchise has been dramatically weakened and any possible future efforts to re-establish a viable business plan for the U.S. subsidiaries will deplete de·plete v. 1. To use up something, such as a nutrient. 2. To empty something out, as the body of electrolytes. capital and operational focus from the European parent. 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. For current Best's Ratings, independent data and analysis on more than 470 reinsurance companies, please visit http://www.ambest.com/reinsurance/. For a list of A.M. Best's debt ratings, please visit http://www.ambest.com/debtratings/. 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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