S&P lowered its FSR and counterparty credit rating on Colonial Penn Insurance Co., Colonial Penn Franklin Insurance Co., Colonial Penn Madison, and GE Auto & Home Assurance Co. (together known as Colonial Penn Property/Casualty Insurance Group, or CPG) to “AA-” minus from “AA.” The outlook is stable.
The rating is a result of the group’s lower-than-historical operating performance and continued customer and geographical concentrations. Those negative factors are partially offset by CPG’s strong capitalization, conservative investment profile and good financial flexibility.
In addition, CPG’s ratings reflect its strategic importance to the parent, GE Financial Assurance Holdings Inc. (GEFA). S&P believes that CPG’s personal lines products round out GEFA’s product offerings while adding its direct marketing expertise to GEFA’s skill set.
Premium volume is expected to decline moderately in 2001, as the group implements re-underwriting and restructuring actions. The combined ratio is expected to range in the 105- to 106-percent range, with further improvements in 2002. Capitalization is expected to remain extremely strong.
Was this article valuable?
Here are more articles you may enjoy.
Cloudy Future for Bourbon Has Jim Beam Closing Distillery for a Year 
MAPFRE Accuses AAA of Violating Long-Time Exclusive Marketing Agreement 
Florida Insurance Agency VP Sentenced to 3 Years in Massive ACA Fraud Scheme 
AIG’s Zaffino to Step Down as CEO as Aon’s Andersen Steps In From This Issue
