A.M. Best Places UICI's Financial Strength Ratings Under Review with Negative Implications.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--July 24, 2003 A.M. Best Co. has placed the financial strength ratings of A- (Excellent) of UICI's (NYSE NYSE See: New York Stock Exchange : UCI UCI University of California, Irvine UCI Union Cycliste Internationale (International Cycling Union) UCI Unidad de Cuidados Intensivos UCI United Cinemas International (UK) ) (Dallas, TX) three insurance entities under review with negative implications. These entities include The MEGA Life and Health Insurance Company, Mid-West National Life Insurance Company of Tennessee, and The Chesapeake Life Insurance Company (all of Oklahoma City Oklahoma City (1990 pop. 444,719), state capital, and seat of Oklahoma co., central Okla., on the North Canadian River; inc. 1890. The state's largest city, it is an important livestock market, a wholesale, distribution, industrial, and financial center, and a farm , OK). A.M. Best will continue to review the recently announced issues with the student loan funding business and determine the impact to UICI. A.M. Best anticipates completing its full analysis and taking the appropriate rating action by year-end 2003. The rating action accounts for the degree of uncertainty regarding any potentially negative impact to UICI's insurance subsidiaries' financial strength, owing to owing to prep. Because of; on account of: I couldn't attend, owing to illness. owing to prep → debido a, por causa de the remaining issues within Academic Management Services Corp. (AMS AMS - Andrew Message System ), UICI's wholly-owned subsidiary. The initial issues included the discovery of a shortfall in the type and amount of collateral supporting two securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. student loan financing facilities entered into by three special financing subsidiaries of AMS and deficiencies with respect to reporting requirements at all seven special financing subsidiaries. A.M. Best recognizes that UICI has entered into waiver and release agreements with all of the financial institutions that are parties to the securitized student loan financing facilities of AMS, greatly reducing the probability of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. . In A.M. Best's opinion, several direct and indirect issues could still hinder the corporation's financial flexibility and, ultimately, the regulated entities' financial strength. Directly, UICI may be required to write down its investment in AMS (including a goodwill impairment charge) or incur litigation-related expenses and charges. Indirectly, the damage to AMS'--and UICI's--reputation could impair relationships needed to generate new student loan financing structures or other corporate-related financial arrangements. 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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