S&P Rts D.A.S. Legal Expenses Insurance A+; Otlk Neg.Business Editors FRANKFURT--(BUSINESS WIRE)--May 1, 2003 Standard & Poor's--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. said today it assigned its 'A+' long-term counterparty credit and insurer financial strength ratings to U.K.-based legal expenses insurance (LEI) underwriter D.A.S. Legal Expenses Insurance Co. Ltd. (DASUK). The outlook is negative. "The ratings reflect the company's strategic importance to Germany-based 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. and insurance group Munich Re Munich Re AG, in German Münchener Rück AG (ISIN: DE0008430026), is the world's second largest reinsurance company with over 5,000 customers in 160 countries and has its headquarters in Munich, Germany. (core companies of which are rated AA-/Negative/--), as well as its strong historic operating performance, strong and defendable business position in the niche LEI market, and good level of capitalization," said Standard & Poor's credit analyst Wolfgang Rief. These strengths are partly offset by the company's risk concentration in the relatively small LEI market--mainly in the U.K.--and its dependence on external sources of distribution. DASUK, the largest legal expenses provider in the U.K., is wholly owned by D.A.S. Deutscher AutomobilSchutz Allgemeine RechtsschutzVers.-AG (DASG DASG Department of the Army, Surgeon General ; A+pi/--/--), which, including its group companies, is the European leader in LEI, with annual premium income of more than GBP GBP In currencies, this is the abbreviation for the British Pound. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 500 million ($818.3 million). DASG, in turn, is part of ERGO group, Germany's second-largest insurance group, with premium income of more than GBP11.9 billion. ERGO is owned by the world's largest reinsurer re·in·sure tr.v. re·in·sured, re·in·sur·ing, re·in·sures To insure again, especially by transferring all or part of the risk in a contract to a new contract with another insurance company. , Munich Reinsurance Co. (MRC See Maximum return criterion. ; AA-/Negative/--). The negative outlook on DASUK reflects the negative outlook on DASUK's ultimate parent, MRC. "DASUK's stand-alone evaluation reflects Standard & Poor's expectation that DASUK's overall financial and risk profiles will remain materially unchanged," said Mr. Rief. This evaluation incorporates the following expectations: DASUK will continue to maintain its leadership position in the U.K. LEI market; gross income will exceed GBP75 million (including noninsurance income of GBP9 million) in 2003; DASUK's risk profile will remain unchanged; its after-the-event business segment (that is, business where an LEI policy is taken out only after the incident has occurred) is not expected to represent more than 10%-15% of net premium income in 2003; DASUK will maintain overall profitability in 2003 (DASUK is targeting a pretax gross result of GBP4.6 million in 2003); and capitalization will be maintained at levels at least similar to 2002. Complete ratings information is available to subscribers of RatingsDirect, Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; under Fixed Income in the left navigation bar A set of buttons or graphic images typically in a row or column used as a central point that link you to major topic sections on a Web site. If the navigation bar is a single graphic image with multiple selections, it is known as an imagemap. See imagemap. , select Credit Ratings Actions. Alternatively, call one of Standard & Poor's Ratings Desks: London (44) 20-7847-7400; Paris (33) 1-4420-6705; Frankfurt (49) 69-33-999-223; or Stockholm (46) 8-440-5916. Members of the media may contact the Press Office Hotline on (44) 20-7826-3605 or via media_europe@standardandpoors.com. ANALYST E-MAIL ADDRESSES See Internet address. e-mail address - electronic mail address wolfgang_rief@standardandpoors.com rob_jones@standardandpoors.com tatiana_grineva@standardandpoors.com InsuranceInteractive_Europe@standardandpoors.com Copyright 2003, Standard & Poor's Ratings Services |
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