Old Republic Cos. Upgraded

February 10, 2003

A.M. Best Co. upgraded the financial strength ratings of Bituminous Insurance Companies to “A+” (Superior) from “A” (Excellent), Old Republic Union Insurance Company to “A” (Excellent) from “B++” (Very Good) (both of Illinois) and Old Republic Minnehoma Insurance Company (Arizona) to “A-“(Excellent) from “B+” (Very Good). The outlook is stable for all.

Bituminous’ rating reflects its strong capitalization and solid operating profitability derived from a disciplined underwriting approach and emphasis on loss control, claims handling and other insurance related services. The rating also considers Bituminous’ expertise in underwriting specialty risk transfer programs for the forest products, oil and gas and construction industries. Bituminous’ capital position is largely reflective of additional economic value embedded in loss reserves and moderate underwriting leverage. It also benefits from the financial flexibility and operational support afforded by its ultimate parent, Old Republic International Corporation. Moderately offsetting the strengths are exposure to fluctuating market values from common stock investments and reduced favorable loss reserve development in recent years.

Old Republic Union’s rating reflects its strategic role within the Old Republic General Insurance Group and excellent capitalization. It will continue to write a small book of surplus lines business for Great West Casualty Company (Nebraska), where it retains a small portion and will begin to write a commercial liability book of business currently written by Old Republic Insurance Company (Pennsylvania).

Old Republic Minnehoma’s rating reflects its solid capitalization and favorable operating results. The company has a strategic role within the Old Republic General Insurance Group, writing collateral protection and auto warranty business.

Also affirmed were the financial strength ratings of the remaining subsidiaries of the Old Republic General Insurance Group.

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Insurance Journal West February 10, 2003
February 10, 2003
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