CORRECTING & REPLACING A.M. Best Affirms Ratings of Balboa Insurance Group & Its Members, Newport E&S Insurance Company, Balboa Life Insurance Company, Balboa Life Insurance Company of New York and General Fidelity Life Insurance Company.

OLDWICK, N.J. OLDWICK, N.J. -- Please replace the release dated November 17, 2009 with the following corrected version due to multiple revisions.

The corrected release reads:

A.M. BEST AFFIRMS RATINGS OF BALBOA INSURANCE GROUP AND ITS MEMBERS, NEWPORT E&S INSURANCE COMPANY, BALBOA LIFE INSURANCE COMPANY, BALBOA LIFE INSURANCE COMPANY OF NEW YORK AND GENERAL FIDELITY LIFE INSURANCE COMPANY

A.M. Best Co. has affirmed the financial strength ratings (FSR) of A (Excellent) and issuer credit ratings (ICR) of "a" of Balboa Insurance Group (Balboa) and its property/casualty members, Balboa Insurance Company (BIC), Meritplan Insurance Company (both of Irvine, CA), Newport Insurance Company (Phoenix, AZ) as well as BIC's stand alone subsidiary, Newport E&S Insurance Company (Newport E&S) (Plano, TX). The outlook for these ratings is stable.

Concurrently, A.M. Best has affirmed the FSRs of A- (Excellent) and ICRs of "a-" of Balboa Life Insurance Company (Irvine, CA), Balboa Life Insurance Company of New York (New York, NY) (together known as Balboa Life) and General Fidelity Life Insurance Company (GFLIC) (Columbia, SC). The outlook for these ratings has been revised to stable from negative.

All companies above are owned by the BA Insurance Group, Inc., which is ultimately owned by Bank of America Corporation (BAC) [NYSE: BAC].

The ratings of Balboa and Newport E&S reflect their solid capitalization, strong underwriting profitability and the organizational, operational and distribution support they derive from being part of BAC.

Offsetting these positive attributes are Balboa and Newport E&S' significant aggregate exposure to catastrophe losses. Furthermore, while Balboa and Newport E&S' shift in their long-range underwriting strategy towards voluntary homeowners' products allows for growth at a somewhat lower risk level with regards to concentration risk, voluntary homeowners' business is inherently more volatile in terms of underwriting performance than the lender placed and collateral protection businesses, as seen in the events of 2008.

Moreover, A.M. Best recognizes Balboa and Newport E&S' continued focus on defining their roles within BAC, as well as outlining the strategic importance of the insurance operations as a distribution point and originator of financial protection products complementing BAC's financial services activities. Balboa and Newport E&S' management expect to benefit from new business opportunities provided through BAC, which will allow Balboa and Newport E&S to sell voluntary homeowners' business through BAC's extensive internet hub and call centers. These enhancements will allow Balboa and Newport E&S to begin to alter their long-range underwriting strategies and diversify into voluntary homeowners' business. Conversely, the risks inherent in executing their portions of the recently designed strategic integration plan for all insurance entities owned by BAC, will continue to exist at Balboa and Newport E&S into the foreseeable future.

The ratings of Balboa Life and GFLIC are based on their continued strong levels of risk-adjusted capital, profitable operating results and an investment portfolio, which has performed well in the current volatile market.

Balboa Life's revised outlook recognizes the expected improved business opportunities afforded it through BAC. A.M. Best anticipates that under BAC, the company will have more opportunities for business expansion. Offsetting these strengths are Balboa Life's continuing declining premium trends, challenges in penetrating its historic core business due to the downturn in the mortgage market and modest results from its current strategic marketing initiatives. While A.M. Best acknowledges the business opportunities within BAC for Balboa Life, challenges do exist in executing a new business plan in the current business environment.

The revised outlook for GFLIC acknowledges its steady increase in net premiums written from assumed credit insurance business through a reinsurance arrangement with MBNA Canada and Assurant Inc. (headquartered in New York, NY). This arrangement has offset the declining trends in credit insurance business for years prior to 2007. Offsetting these strengths is GFLIC's reliance on a single reinsurance source for nearly all of its business.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.