Ratings Roundup: COUNTRY, Proformance, Palisades Group

A.M. Best Co. has assigned issuer credit ratings (ICR) of “aa-” and affirmed the financial strength ratings (FSR) of ‘A+’ (Superior) of COUNTRY Insurance & Financial Services of Bloomington, Ill., its property/casualty members and key life insurance affiliates. Best also assigned an ICR of “a-” and affirmed the FSR of ‘A-‘ (Excellent) of Cotton States Life Insurance Company. The outlook on all of the ratings is stable. Concurrently, Best has withdrawn the FSR of ‘A’- (Excellent) and assigned a category NR-5 (Not Formally Followed) to Mutual Service Life Insurance Company, following the announcement that Mutual Service was merged with its parent company, COUNTRY Life Insurance Company, effective November 1, 2007. “The property/casualty ratings of COUNTRY Financial reflect its strong risk-adjusted capitalization, favorable operating performance, adherence to strict underwriting principles and the competitive advantages from the sponsorship by several state Farm Bureau Federations that facilitate marketing, business retention and government relations,” said Best.

A.M. Best Co. is maintaining the under review status with negative implications of the financial strength rating (FSR) of ‘B++’ (Good) and issuer credit rating (ICR) of “bbb” of Proformance Insurance Company. Best is also keeping the ICR of “bb” of the holding company, National Atlantic Holdings Corporation under review status with negative implications. Best explained: “The decision to maintain the under review status is based on Proformance’s holding company, National Atlantic, entering into a definitive agreement on March 13, 2008 to be acquired by a subsidiary of Palisades Safety and Insurance Association (Berkeley Heights, NJ), a New Jersey licensed insurance exchange. The closing of the transaction is expected to occur in third quarter 2008, and is subject to the approval of National Atlantic’s shareholders, certain regulatory approvals and the satisfaction or waiver of other closing conditions.

In a companion announcement to the one above, A.M. Best Co. said it “has placed the financial strength rating (FSR) of ‘B++’ (Good) and the issuer credit ratings (ICR) of “bbb” of the Palisades Group (Palisades) (Berkeley Heights, NJ) and its membersunder review with negative implications. Best also placed the FSR of ‘B++’ (Good) and ICRs of “bbb” of the wholly owned and separately rated High Point Group (Red Bank, NJ) and its members under review with negative implications. Best explained: “The Palisades Group is comprised of Palisades Safety and Insurance Association and its wholly owned subsidiary, Palisades Insurance Company, as well as the members of the High Point Group: High Point Preferred Insurance Company, High Point Property and Casualty Insurance Company, High Point Safety and Insurance Company, Twin Lights Insurance Company and Teachers Auto Insurance Company of New Jersey.These rating actions reflect the March 13, 2008 signing of a definitive agreement for Palisades to purchase National Atlantic Holdings Corporation, including its wholly owned subsidiary, Proformance Insurance Company.”