Ratings Roundup: Triad Guaranty, Allstate and Affiliates

Standard & Poor’s Ratings Services has placed its ‘AA’ counterparty credit and financial strength ratings on Triad Guaranty Insurance Corp. and its ‘A’ counterparty credit rating on Triad Guaranty Inc. on CreditWatch with negative implications. “The CreditWatch follows today’s announcement by Triad Guaranty Inc. that its loss ratio rose to 148 percent in the third quarter of 2007,” explained S&P credit analyst James Brender. “Our primary concerns are Triad’s operating performance in the next two years.”

Standard & Poor’s Rating Services has revised its outlook on Allstate Corp., Allstate Insurance Co. (AIC) and its P/C affiliates (collectively, Allstate Protection), and Allstate Life Insurance Co. and its life insurance affiliates (collectively, Allstate Financial) to stable from negative. S&P also affirmed its ‘A+’ counterparty credit rating on Allstate and its ‘AA’ counterparty credit and insurer financial strength ratings on Allstate Protection and Allstate Financial, which it views as “core to Allstate.
S&P credit analyst Neil Stein noted that the revised outlook reflects S&P’s “belief that Allstate has successfully reduced its gross and net catastrophe exposure in the homeowners’ book of business while sustaining its competitive and earnings profile. This is demonstrated by positive organic growth and sustained profitability in the auto book of business.” He added that “while enterprise risk management (ERM) remains at the adequate level,” S&P believes pending enhancements to ERM “have the potential to revise our opinion to the strong level.”