A.M. Best Co. has downgraded the financial strength rating to B+ (Very Good) from B++ (Very Good) of Nationwide Indemnity Company (Nationwide Indemnity) (Columbus, Ohio). The rating has been placed under review with negative implications due to the significant decline in capitalization reported in the company’s third quarter financial statement.
Nationwide Indemnity strengthened reserves in the third quarter, which resulted in a reduction of surplus by approximately $300 million, which contributed to the dramatic reduction in risk-adjusted capitalization. The company will remain under review with negative implications pending discussions with management on the restoration of its capitalization.
Nationwide Indemnity is a wholly-owned subsidiary of Nationwide Mutual Insurance Company (Nationwide) (Columbus), and was established to run off Nationwide’s discontinued operations, including indemnity claims.
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