A.M. Best Co. affirmed the “A” FSRs of SAFECO Corporation’s property/casualty and life/health subsidiaries and removed all ratings from under review. In addition, SAFECO’s commercial paper rating of “AMB-2,” senior debt rating of “bbb+” and capital securities rating of “bbb” have also been reaffirmed.
The negative outlook presently on the property/casualty operations and the debt ratings remains in effect but has been removed from the life/health companies.
The affirmation of SAFECO’s ratings recognizes the actions management has taken to significantly decrease financial leverage, relieve significant short-term debt exposure, improve holding company cash flows and turn around overall operating performance.
A.M. Best views positively the recent steps taken, which include a 50-percent reduction in the shareholder dividend, the decision to sell SAFECO Credit, a $1.2-billion write-off of goodwill, restructuring of field operations, a review of overall business segment performance and plans to improve underwriting fundamentals.
The rating affirmation is predicated upon completion of the sale of SAFECO Credit by the end of third quarter 2001.
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