A.M. Best said that its ratings on Accident Fund Group of Lansing Mich. and its subsidiaries “remain unchanged following the recent announcement that Accident Fund Insurance Company of America will be acquiring CWI Holdings, Inc. and its subsidiaries.” Best noted that the acquisition includes “San Francisco-based CompWest Insurance Company, which is currently rated NR-1 (Insufficient Data) by Best and is expected to be assigned a financial strength rating (FSR) prior to or in concurrence with the close of this transaction.”
A.M. Best has placed the financial strength rating of “A-” (Excellent) and the issuer credit rating (ICR) of “a-“of Birmingham Ala.-based American Mining Insurance Company under review with positive implications. The change follows the announcement that W. R. Berkley Corporation has executed a definitive agreement to acquire CGH Insurance Group, the parent company of American Mining. “Subsequent to the planned acquisition, American Mining is expected to be reinsured by Berkley Regional Insurance Company, a wholly-owned subsidiary of W. R. Berkley,” Best explained. “W. R. Berkley Corporation and American Mining are entering the regulatory approval process, with the agreement subject to a number of conditions, including approval of the Alabama Department of Insurance.”
Standard & Poor’s Ratings Services today commented on CNA Financial Corp’s announcement that it has reached an agreement with John Hancock Life Insurance Co. to settle all exposures under four excess-of-loss reinsurance treaties issued by CNA Reinsurance Co. Ltd. (CNA Re Ltd.), a former CNA subsidiary. The treaties have been the subject of arbitration proceedings since 2000. Under the settlement agreement, CNA will make a one-time payment to John Hancock of $250 million, resulting in an after-tax loss (net of reinsurance) of approximately $110 million to be recorded in the third quarter of 2007. The charge will result in a modest reduction in CNA’s 2007 net operating income, which for the first six months of 2007 was $625 million.
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