OLDWICK, N.J.--(BUSINESS WIRE)--
A.M. Best Co. has downgraded the financial strength rating (FSR)
to E (Under Regulatory Supervision) from C++ (Marginal) and the issuer
credit rating (ICR) to “rs” from “b” of Millers First Insurance
Company(Millers) (Alton, IL). A.M. Best also has downgraded the FSR
to C- (Weak) from C++ (Marginal) and the ICR to “cc” from “b” of
Millers’ wholly owned subsidiary,Millers Classified Insurance Company
(Classified) (Madison, WI). The ratings for Classified have been placed
under review with negative implications.
The rating actions on Millers follow the announcement that the Illinois
Department of Insurance has issued an order of conservation for Millers,
effective June 11, 2012. The order follows the company’s severe
catastrophe loss activity throughout 2010 into the current quarter,
which has severely depleted its capital position. An order of
rehabilitation is pending and all valid claims continue to be paid in
While the order does not include Classified since it is domiciled in
Wisconsin and is outside the regulatory purview of the Illinois
Department of Insurance, the downgrading of the ratings for Classified
is primarily due to its current financial condition with a reduction in
capitalization primarily from the same storms. The under review status
of Classified is due to its potential for additional underwriting
losses, which could further weaken its capital position, as well as the
potential for some form of regulatory action relating to Classified’s
location. A.M. Best expects to resolve the under review status of
Classified once these issues have been clarified and/or resolved.
The methodology used in determining these ratings is Best’s Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best’s rating process and contains the different rating criteria
employed in the rating process. Key criteria utilized include: “Risk
Management and the Rating Process for Insurance Companies”;
“Understanding BCAR for Property/Casualty Insurers”; and “Catastrophe
Analysis in A.M. Best Ratings.” Best’s Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world’s oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2012 by A.M. Best Company, Inc.ALL RIGHTS
A.M. Best Co.Neil Das Gupta, 908-439-2200, ext. 5206Senior
Burtone, 908-439-2200, ext. 5125Assistant Vice Presidentjoseph.firstname.lastname@example.orgRachelle
Morrow, 908-439-2200, ext. 5378Senior Manager, Public
Peavy, 908-439-2200, ext. 5644Assistant Vice President,
Source: A.M. Best Co.