A.M. Best Places Crum & Forster and TIG Under Review.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Nov. 6, 2001 A.M. Best Co. has placed the financial strength ratings of A- (Excellent) for Crum & Forster Insurance Group (CFI CFI abbr. cost, freight, and insurance ), Morristown, New Jersey Morristown is a town in Morris County, New Jersey, United States. As of the United States 2000 Census, the town population was 18,544. Its estimated population in 2004 was 18,842. It is the county seat of Morris CountyGR6. and TIG n. 1. A game among children. See Tag. 2. A capacious, flat-bottomed drinking cup, generally with four handles, formerly used for passing around the table at convivial entertainment. Insurance Group (TIG), Dallas, Texas, under review with developing implications following the third quarter earnings release by the parent, Fairfax Financial Holdings Fairfax Financial Holdings Limited TSX: FFH.SV NYSE: FFH is a Toronto, Ontario based financial services holding company which, through its subsidiaries, is engaged in property, casualty and life insurance and reinsurance, investment management and insurance claims Limited (TO:FFH FFH Far From Home (band) FFH Fast Frequency Hopping FFH Frigate Helicopter FFH Final Fantasy High (gaming) FFH Fauji Foundation Hospital (Pakistan) FFH Falling for Her ). The under review ratings action reflect gross reserve strengthening of $400 million at CFI and $200 million at TIG. This is in response to a material deterioration in carried loss reserves for each organization, relating primarily to 1998, 1999 and 2000 accident years. However, the net impact of this action to each group's capital adequacy is significantly reduced, as each is partially protected by stop loss 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. and/or third party indemnification. In the context of the property and casualty insurance market, 1998 and 1999, accident years were particularly competitive. At the height of the soft commercial market in 1998, Fairfax acquired CFI and TIG. As such, this most recent reserving action largely represents the culmination of competitive pricing and relaxed underwriting standards, under the prior ownership structure. Since their acquisitions, Fairfax has replaced the management teams of each company and has taken extensive actions to re-underwrite the books of business. However, the extent of required underwriting actions in the face of difficult market challenges has protracted pro·tract tr.v. pro·tract·ed, pro·tract·ing, pro·tracts 1. To draw out or lengthen in time; prolong: disputants who needlessly protracted the negotiations. 2. the turnaround strategy for both groups. The ratings for CFI and TIG will remain under review pending further discussion with management concerning operating and capital strategies and the completion of A. M. Best's due diligence with respect to each group's overall reserve position. The financial strength ratings of Fairfax's other insurance subsidiaries as well as its debt ratings are unaffected at this time. 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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