The financial strength rating of East Lansing, Mich.-based medical liability insurer American Physicians Capital Inc. has been downgraded to “B+” from “B++” by A.M. Best Co. This action, according to Best, reflects a reduction in the company’s risk-adjusted capital and statutory surplus as a result of a $43 million ($28 million, net of tax) reserve adjustment recorded in the 2003 third quarter.
CEO R. Kevin Clinton said in a statement the rating showed the company’s financial footing was still secure, and that the company’s actions would help it regain its “A-” rating. The company recently announced it was pulling out of the Nevada market for medical liability, and is exiting the workers’ compensation and health insurance lines altogether.
Best also downgraded the financial strength rating for the company’s other insurance subsidiaries, APSpecialty to “B+,” and Insurance Corporation of American (ICA) to “B-.” Best has also stated that all of the ratings, including the American Physicians rating remain under review with negative implications pending, among other things, the assessment of the each company’s finalized year-end 2003 capital adequacy, operating structure and holding company financial leverage.
APCapital subsidiary American Physicians Assurance Corp. also announced its commitment to remaining in the Ohio medical liability marketplace.
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