GE Financial/P&C Under Review

A.M. Best Co. has placed the financial strength rating of “A” (Excellent) of the members of GE Financial/P&C under review with developing implications. The action follows the June 25 announcement that General Electric Co.’s (GE) GE Insurance unit agreed to sell GE Property & Casualty Insurance Co. and its subsidiaries and GE Edison Life Insurance Co. to American International Group for approximately $2.15 billion.

The transaction is expected to be completed in the third quarter of 2003. The rating will remain under review until regulatory approval is received and discussions are held with management on the integration of these companies into the AIG organization.

In a separate action, the rating of Montgomery Ward Insurance Co., a member of GE Financial/P&C, was placed under review with negative implications following the agreement to sell GE Financial/P&C. The rating action reflects the uncertainty regarding the company’s role going forward in GE Insurance and the financial and operating impact that the sale of GE Property & Casualty Insurance Company will have on the company. The stand-alone financial strength rating of Montgomery Ward prior to its inclusion in GE Financial/P&C was “B++” (Very Good).

Topics Property Casualty