A.M. Best Co. has downgraded the financial strength rating (FSR) to B++ (Very Good) from A- (Excellent) of Omega Insurance Company (Gainesville, Fla.). The rating remains under review with negative implications.
The downgrade is attributable to the deterioration of risk-adjusted capitalization, primarily as a result of the estimated losses associated with Hurricane Wilma. The rating was previously placed under review with negative implications on Nov. 7, pending A.M. Best’s review of Omega’s various capital enhancement initiatives. While management’s capital replenishment plan will result in improved risk-adjusted capitalization, it is no longer supportive of the former rating.
The rating will remain under review pending execution of additional capital enhancement as well as A.M. Best’s continued review of Omega’s strategic plans. In the event the proposed recapitalization plan is not fully implemented in the near term, the rating will likely be further downgraded.
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