Ratings: Atlantic American, Safeco

October 4, 2007

A.M. Best Co. has taken various rating actions on the financial strength ratings (FSR) and issuer credit ratings (ICR) of the property/casualty and life/health subsidiaries of Atlantic American Corporation (AAME) of Atlanta, GA. Best also affirmed the ICR of “bbb-” of AAME; however; the rating outlook is negative. Best said it has “downgraded the FSR to ‘B+’ (Good) from ‘B++’ (Good) and the ICR to “bbb-” from “bbb” of Georgia Casualty & Surety Company (GCSC) (Atlanta, GA),” and revised its outlook on both ratings to stable from negative. In addition, Best affirmed the FSRs of ‘A-‘ (Excellent) and the ICRs “a-” of Association Casualty Insurance Company (ACIC) of Austin Tex. and American Southern Group, which consists of American Southern Insurance Company and its wholly owned subsidiary, American Safety Insurance Company (both of Atlanta, GA). “The outlook for ACIC’s ratings is negative, and the outlook for American Southern’s ratings is stable,” said the bulletin. Concurrently, Best affirmed the FSR of ‘B++’ (Good) and the ICR of “bbb” of the life/health insurance company, Bankers Fidelity Life Insurance Company, with a stable outlook.

Fitch Ratings has upgraded Safeco’s ratings as follows:
Safeco Corporation
–Issuer Default Rating (IDR) to ‘A+’ from ‘A’;
–4.20 percent senior unsecured notes due 2008 to ‘A’ from ‘A-‘;
–4.875 percent senior unsecured notes due 2010 to ‘A’ from ‘A-‘;
–7.250 percent senior unsecured notes due 2012 to ‘A’ from ‘A-‘.
*Safeco Property/Casualty Group
–Insurer financial strength to ‘AA’ from ‘AA-‘.
The outlook on all of the ratings is stable. “The ratings upgrade reflects improvement in Safeco’s overall risk profile, strong capitalization, good profitability over the past several years, solid competitive position, and sound balance sheet,” said Fitch.

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