A.M. Best Upgrades Rating of Tower Insurance Company of New York.

OLDWICK, N.J. -- A.M. Best Co. has upgraded the financial strength rating to A- (Excellent) from B++ (Very Good) of Tower Insurance Company of New York (TICNY) (New York, NY). The rating outlook is stable.

This rating action takes into consideration TICNY's publicly-traded parent, Tower Group, Inc.'s (Tower) (NASDAQ:TWGP) $110.5 million initial public equity offering completed on October 25, 2004, the subsequent capital contribution provided to TICNY immediately following this offering, and management's adherence to a business plan previously provided to A.M. Best. In addition, this rating action takes into account TICNY's experienced management team, its near term earnings prospects and the continued benefits to be derived from the recent price firming throughout the property/casualty insurance markets. The rating upgrade also considers management's intention to prudently capitalize TICNY at levels previously discussed with A.M. Best. This rating upgrade also recognizes TICNY's sustained underwriting profitability, the benefits afforded by its affiliated managing general agent, Tower Risk Management Corp., and the increased financial flexibility provided by Tower. Tower Risk Management produces business on behalf of other insurance companies, thus generating fee income to the benefit of Tower. TICNY has the ability to reinsure a portion of this business or to write it directly as capacity allows.

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.