S&P Announces: Associated Industries Insurance Co. 'Bpi' Ratings Affirmed.Business Editors NEW YORK--(BUSINESS WIRE)--Nov. 25, 2003 On Nov. 25, 2003, Standard & Poor's Ratings Services Ratings Service A company, such as Moody's or Standard & Poor's, that rates various debt and preferred stock issues for safety of payment of principal, interest, or dividends. affirmed its 'Bpi' counterparty Counterparty The other participant, including intermediaries, in a swap or contract. credit and financial strength ratings on Associated Industries Insurance Co. (AIIC AIIC Association des Infirmières et Infirmiers du Canada (Canadian Nurses Association) AIIC Association Internationale des Interprètes de Conférence (International Association of Conference Interpreters) ). The ratings reflect the company's marginal capitalization, weak operating performance, and extremely high geographical and product line concentrations. Major Rating Factors -- AIIC's capital adequacy is marginal, as demonstrated by a Standard & Poor's 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. of 56.2% as of year-end 2002. The company's leverage (net premium plus liabilities/surplus) is 7.76x, which is higher than its peers. -- Operating performance has been weak, with a Standard & Poor's earnings adequacy ratio of 22.8% (as of when?). In addition, the company has volatile returns, with the ROA ROA See: Return on assets ROA See: Right of accumulation ROA See return on assets (ROA). ranging from negative 0.9% in 1999 to positive 0.8% in 2002. -- AIIC's geographic and product line concentrations are extremely high, exposing it to economic, legal, and regulatory risks. In 2002, more than 99% of its business was written in Florida. Moreover, the company writes only workers' compensation insurance. Based in Boca Raton Boca Raton (bō`kə rətōn`), city (1990 pop. 61,492), Palm Beach co., SE Fla., on the Atlantic; inc. 1925. Boca Raton is a popular resort and retirement community that experienced significant industrial development in the 1970s and 80s. , Fla., AIIC writes only worker's compensation insurance and distributes its products primarily through independent general agents. The company, which began business in 1954, is licensed in Alabama, Florida, Georgia, and Mississippi. The parent company of AIIC is Associated Industries Insurance Services Inc. The company is rated on a stand-alone basis. Ratings with a 'pi' subscript (1) In word processing and scientific notation, a digit or symbol that appears below the line; for example, H2O, the symbol for water. Contrast with superscript. (2) In programming, a method for referencing data in a table. are insurer financial strength ratings based on an analysis of an insurer's published financial information and additional information in the public domain. They do not reflect in-depth meetings with an insurer's management and are therefore based on less comprehensive information than ratings without a 'pi' subscript. Ratings with a 'pi' subscript are reviewed annually based on a new year's financial statements, but may be reviewed on an interim basis if a major event that may affect the insurer's financial security occurs. Ratings with a 'pi' subscript are not subject to potential CreditWatch listings. Ratings List Associated Industries Insurance Co. Counterparty credit rating Bpi Financial strength rating Bpi |
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