ATTORNEYS LIABILITY PROTECTION SOCIETY Rated 'A-'.NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire-- July 28, 1999--Standard & Poor's today assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. its single-'A'-minus counterparty Counterparty The other participant, including intermediaries, in a swap or contract. credit and financial strength ratings to ATTORNEYS LIABILITY PROTECTION SOCIETY (ALPS Alps, great mountain system of S central Europe, c.500 mi (800 km) long and c.100 mi (160 km) wide, curving in a great arc from the Riviera coast on the Mediterranean Sea, along the borders of N Italy and adjacent regions of SE France, Switzerland, SW Germany, and ), A Mutual Risk Retention Group. The outlook is stable. The rating assignment is based on the company's very strong capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. , excellent operating performance, strong management, and good strategy. Major rating factors include: -- ALPS, a Missoula, Mont.-based company, has a strong management team that has recognized the need to plan wisely for future market contingencies. Management seeks to accomplish this through plans for diversifying outside of the 16 jurisdictions in which it presently writes business, and internationally, by diversifying lines of business, expanding Internet access See how to access the Internet. , and optimizing employee potential. -- Operating and underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. performance has been exceptionally strong with return on revenue at 17.9% for year-end 1998 and averaging 22% over the past five years, although it has been trending downward. The combined ratio for 1998, at 93.9%, is excellent and has been so for the past five years. These strong results are attributable to good loss control and underwriting as expenses have been about average for the industry. In addition, loss reserves are set conservatively. -- Capitalization also is strong, with the capital adequacy ratio Capital adequacy ratio (CAR), also called Capital to Risk (Weighted) Assets Ratio (CRAR)[], is a ratio of a bank's capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss. well above 300%. The strength is especially significant considering the company's concentration in professional liability. The company is currently exploring various capital strategies for the future. ALPS is a writer of attorneys' liability and employment practices liability coverages only, which leaves the company concentrated by line. However, this concentration is somewhat offset by the fact that it writes in 16 jurisdictions. The company was formed in 1987 to provide a stable insurance market in the rural U.S. states A U.S. state is any one of the fifty subnational entities of the United States, although four states use the official title "commonwealth". The separate state governments and the federal government share sovereignty, in that an American is a citizen both of the federal entity and , and was funded by the sale of surplus contribution certificates that pay no interest and are only repayable after the surplus reaches $15 million. -- Financial flexibility is limited as ALPS is a mutual insurance company that operates as a mutual risk retention group. ALPS is a Security Circle insurer, which means that it underwent Standard & Poor's most comprehensive analysis and was assigned a rating in one of the top four categories for financial security. EXPECTATIONS/OUTLOOK: STABLE Standard & Poor's expects a combined ratio of approximately 100%. Growth in premium will continue both from less ceded premium and from expansion into other jurisdictions. Continued geographic expansion will lessen less·en v. less·ened, less·en·ing, less·ens v.tr. 1. To make less; reduce. 2. Archaic To make little of; belittle. v.intr. To become less; decrease. concentration. ALPS' surplus now exceeds $15 million, with unassigned surplus of more than $10 million. Accordingly, the company is considering a surplus contribution certificate repayment plan or may amend its structure via a limited stock offering to retire the outstanding certificates, Standard & Poor's said. --CreditWire |
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