Standard & Poor’s has removed from Credit Watch and lowered its counter party credit and financial strength ratings on Star Insurance Co. and its wholly-owned subsidiary, Savers Property & Casualty Insurance Co.—collectively known as Meadowbrook Insurance Group (Meadowbrook)—to “BB+” from “A”. These ratings had been placed on CreditWatch with negative implications on Feb. 20, 2001. At management’s request, Standard & Poor’s subsequently withdrew these ratings.
The ratings had been placed on CreditWatch following the group’s fourth-quarter 2000 earnings release, whereby the group reported a net loss of $19.2 million for the quarter.
These rating actions reflect S & P’s concerns that the group might fall below accepted levels of regulatory capital as measured by the National Association of Insurance Commissioner’s risk based capital ratio. As of year-end 2000, Star Insurance Co. reported a risk based capital ratio of 208 percent.
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