A.M. Best Takes Various Rating Actions on Co-operators General and Its Subsidiaries.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating (FSR (Free System Resource) In Windows 3.x, the amount of unused memory in various 64K blocks reserved for managing current applications. Every open window takes some space in this area. See Windows memory limitation. ) of A- (Excellent) and the issuer credit rating (ICR (Intelligent Character Recognition or Image Character Recognition) The machine recognition of hand-printed characters as well as machine printing that is difficult to recognize. ) of "a-" of Co-operators General Insurance Company (Co-operators General) (Ontario). A.M. Best has also upgraded the FSR to B++ (Very Good) from B+ (Very Good) and the ICR to "bbb" from "bbb-" for Co-operators General's wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , The Sovereign General Insurance Company (Sovereign) (Alberta). In addition, A.M. Best has affirmed the FSRs of B+ (Very Good) and the ICRs of "bbb-"of Co-operators General's other wholly owned subsidiaries, L'Union Canadienne Compagnie D'Assurances (L'Union) (Quebec) and COSECO Insurance Company (COSECO) (Ontario). Concurrently, A.M. Best has affirmed the FSR of A (Excellent) and ICR of "a" of Co-operators Life Insurance Company (Co-operators Life) (Saskatchewan). Additionally, A.M. Best has affirmed the ICR of "bbb-" and the debt rating of "bbb-" on CAD 150 million 5.07% senior unsecured debentures due July 2012 of Co-operators Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. Limited (CFSL CFSL Cavitation-Field Sonoluminescence ) (Ontario), the interim holding company of Co-operators General and Co-operators Life. The outlook for all ratings is stable. The ratings of Co-operators General reflect its superior capitalization and balance sheet strength, profitable operating performance and experienced management team. The ratings also take into consideration the company's market leadership position driven by its strong brand name recognition, product line and geographic diversification and effective use of its multi-channel distribution system. Partially offsetting these positive rating factors are the current downturn in the underwriting cycle for commercial lines products, uncertainty of the long-term effects of regulated pricing and product changes for auto insurance and potential earnings volatility from subsidiary operations. The ratings of Sovereign are reflective of its improved risk-adjusted capitalization and strong, liquid balance sheet, positive profitability trend, explicit and implicit parental support and its strategic role within the Co-operators group. Sovereign offers primarily mid to small commercial lines coverage through independent brokers across Canada Across Canada was an afternoon program that formerly aired on The Weather Network. The segment ran from early 1999 until mid 2002. The show ran from 3:00PM ET until 7:00 PM ET. . Leverage ratios have improved from strong organic surplus growth while premium risk growth has remained relatively flat. In addition, the company benefits from cross marketing opportunities and services it receives from affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. . These rating strengths are offset in part by Sovereign's history of reserve deficiencies reserve deficiency A shortage in funds set aside as a reserve for a specific purpose. For example, during a recession a firm may find the reserve fund covering allowance for bad debts deficient when the amount of bad debts exceeds expectations. , moderate exposure to property loss due to earthquakes in western Canada
Western Canada, commonly referred to as the West , as well as competitive pricing pressure in its core commercial lines. These concerns are mitigated, in part, by management's actions to focus on core business by exiting less profitable personal lines and increasing reserves. In addition, surplus is protected by a comprehensive 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. program with primarily high quality reinsurers. The ratings of L'Union and COSECO recognize their respective financial strengths and historically profitable operating performance, their strategic roles within the Co-operators group, as well as each company's individual challenges within their market niches. L'Union serves as Co-operators General's primary vehicle for distribution of commercial and personal lines products through independent brokers in Quebec, Newfoundland and Labrador Newfoundland and Labrador, province, Canada Newfoundland and Labrador (ny  `fənlənd, ny , while COSECO offers personal lines products primarily through employer and association groups, as well as on a direct basis. The ratings of Co-operators Life reflect its continued strong level of profitability, consistent surplus growth and excellent risk-adjusted capitalization. It also recognizes the premium growth the company has realized in its core business segments in recent years through multi-channel distribution, which offers a wide variety of products to individual, group and credit union markets throughout Canada. Co-operators Life faces challenges cross-selling to the property/casualty policyholder base and competition from larger insurance organizations. 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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