S&P Rates Infinity Property Senior Secured Loan ‘BBB’

Standard & Poor’s Ratings Services said assigned its ‘BBB’ senior debt rating to Birmingham, Ala.-based Infinity Property and Casualty Corp.’s $200 million senior secured term loan facility.

“The rating is based on the group’s strong market position as the third largest nonstandard automobile writer in the U.S., extremely strong pro forma capital adequacy at the operating level based on a Standard & Poor’s capital adequacy ratio of more than 200 percent, significantly improved operating performance, conservative investment strategy, and relatively low financial leverage at the holding-company level,” said Standard & Poor’s credit analyst Polina Chernyak.

Partially offsetting these factors is the group’s narrow scope of operations as primarily a nonstandard auto writer and Infinity’s relatively short operating history as a public entity following its recent spin-off from former parent, American Financial Group Inc.

Standard & Poor’s expects Infinity’s operating performance to continue to improve in 2003 and 2004. Capital adequacy is expected to remain very strong. Total debt to total capital at the holding-company level is expected to be within the rating range over the medium term, while interest coverage is expected to remain supportive of the rating level.