A.M. Best Co. has downgraded the financial strength rating of MIIX Group of Lawrenceville, New Jersey, and its two subsidiary companies, Lawrenceville Property & Casuaty Co., and MIIX Insurance Co. of NY, to B- (Fair) from A- (Excellent), following the company’s announcement that it would delay reporting its fourth quarter results (See IJ Website Feb. 21).
Best noted that MIIX was “expecting an operating loss from adverse loss reserve development,” and indicated that this would “significantly weaken capitalization.” The rating agency also noted its “concerns regarding the adequacy of loss reserves given the adverse trends in the medical malpractice line of business and the reserve strengthening taken in the second quarter of 2000.”
Best said it would keep the rating under review “with negative implications,” and also noted its concerns “over MIIX’s future direction and the state of the company’s operations following the numerous changes in key management positions over the last two years.” .
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