Best Puts Gerling Canada Rating Under Review

May 5, 2003

A.M. Best Co. announced that it has placed the financial strength rating of A- (Excellent) of Gerling Canada Insurance Company (Toronto) “under review with developing implications.” The bulletin noted that the rating agency had affirmed its ratings on the parent company, Gerling Konzern Allgemeine, last March, but had changed its outlook from stable to negative.

A.M. Best Co. announced that it has placed the financial strength rating of A- (Excellent) of Gerling Canada Insurance Company (Toronto) “under review with developing implications.” The bulletin noted that the rating agency had affirmed its ratings on the parent company, Gerling Konzern Allgemeine, last March, but had changed its outlook from stable to negative.

“The current under review status reflects the pending sale of Gerling Canada to a group of Canadian financial and other private equity investors,” said Best. “The transaction is organized through Newport Partners, a Toronto based investment company. Once the sale is finalized, it will resolve the uncertainty surrounding Gerling Canada’s future due to issues affecting its ultimate parent company, Gerling Konzern Beteiligungs-AG (Germany).”

Best indicated that it is “in the process of due diligence on the sales transaction and is in regular discussions with Gerling Canada’s management. A.M. Best will assign Gerling Canada a stand-alone rating upon completion of the sale.”

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