Standard & Poor’s has joined A.M. Best (see IJ Website Nov. 20) in lowering its ratings on New Jersey-based Highlands Insurance Co. Inc. and its affiliated companies, reflecting its “concern about the companies’ capital position and adequacy of loss reserves.”
Outstanding ratings were lowered from double-’Bpi’ to triple-’Cpi’ on Highlands and the following affiliates: Highlands Underwriters Ins. Co; Highlands Casualty Co.; Aberdeen Ins. Co.; Highlands Lloyds; Northwestern National Casualty Ins. Co.; Pacific National Ins. Co., and Pacific Automobile Ins. Co.
S&P observed that the group’s 65 million loss for the first nine months of the year was primarily due to “adverse reserve development of $52.8 million,” which had “eroded the consolidated capital adequacy ratio, based on Standard & Poor’s capital adequacy model, to less than 50% on a pro forma basis, which is considered extremely weak.”|”snp, lowers, highlands, ratings, ‘cccpi’
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