Pilgrim Insurance Lands Excellent Mark from Best

September 21, 2004

Pilgrim Insurance, a unit of The Plymouth Rock Group of Companies, announced receipt of an initial rating of A-/ Excellent from A.M. Best. Pilgrim, a business process outsourcer for Massachusetts auto insurance, has received the positive rating upon the company’s initial request for an A.M Best financial review.

“The A-/Excellent rating is an exceptional starting point from an accrediting agency known for its diligence and integrity,” Ellen Wilcox, Pilgrim’s president and CEO, said. “We are pleased that A.M. Best has recognized our strength, stability and commitment to ongoing performance excellence.”

In assigning its rating to Pilgrim, Best recognized Pilgrim’s ongoing stability, including favorable operating performance, above-average capitalization and extensive local market knowledge. “This positive rating confirms our commitment to our agents, our policyholders and our business process outsourcing customers,” Wilcox added.

In assigning the A-/Excellent rating, Best included in its rationale an emphasis on Pilgrim’s solid financial performance: “The rating reflects the company’s solid capitalization and strong operating earnings. Earnings are driven by a steady fee based revenue stream that has resulted in double-digit returns on equity over the last five years. Slightly offsetting these positive rating attributes are the company’s high reinsurance recoverable and ceded reinsurance balances on personal and commercial automobile policies written for the Commonwealth Automobile Reinsurers (CAR), the Massachusetts assigned risk pool. Based on the company’s solid capitalization and consistently strong earnings, A.M. Best views the rating outlook as stable.

“The company’s positive rating attributes are derived from its focused strategy as a servicing carrier of policies written under state-mandated involuntary personal and commercial automobile for the Commonwealth Automobile Reinsurers (CAR), which enables the company to collect substantial fee income that drives operating earnings. The rating also acknowledges the financial flexibility of the company’s ultimate parent, The Plymouth Rock Company, and the operational synergies and business opportunities it receives from affiliated companies. As previously mentioned, the company’s risks are derived from reinsurance recoverable and ceded reinsurance balances. However, the credit risk is mitigated since balances are due predominantly from state insurance plans and highly rated insurers. In addition, this risk is also mitigated by the joint and several liability of all CAR member companies.”

Pilgrim of Boston, provides complete business process outsourcing (BPO) services for private passenger and commercial automobile business.

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