MOODY'S CONFIRMS INSURANCE FINANCIAL STRENGTH RATINGS OF CIGNA'S PROPERTY AND CASUALTY GROUP AND ASSIGNS NEW RATINGS TO GROUP MEMBERS
New York, 02-06-98 -- Moody's Investors Service confirmed the Baa1 insurance financial strength ratings of certain members of CIGNA Corporation's active property and casualty insurance group and has assigned Baa1 insurance financial strength ratings to three additional members of that group. Moody's also confirmed the Ba1 insurance financial strength ratings of two members of the inactive property and casualty insurance group--the Brandywine Group--and assigned a Ba1 insurance financial strength rating to the third member of that group, Century Reinsurance Company.
Moody's Baa1 insurance financial strength ratings on the members of the active CIGNA Property and Casualty group reflect the group's focus as a specialist property and casualty organization, its improving operating trends, its high-quality investments, and its affiliation with CIGNA Corporation (senior debt at A3) – a diversified holding company that has profitable operations in other insurance and financial services sectors. These strengths are offset by the company's modest operating performance, its negative cash flows (reflecting the active and inactive operations combined), and a significant contingent call on its capital by the Brandywine Group through an intercompany stop-loss agreement. Moody's also noted its concerns over uncertainty regarding the role of the domestic property and casualty operations in CIGNA Corporation's long-term strategy.
According to the rating agency, the Ba1 insurance financial strength ratings on companies in the Brandywine Group reflect Moody's continued concerns regarding the ultimate adequacy of asbestos and environmental reserves and ceded reinsurance for those companies, as well as for many companies in the industry, and run-off state of Brandywine Group.
The Baa1 insurance financial strength ratings of the following members of the active property and casualty insurance group were confirmed:
Insurance Company of North America;
Indemnity Insurance Company of North America;
CIGNA Property and Casualty Insurance Company;
Pacific Employers Insurance Company;
CIGNA Insurance Company;
Bankers Standard Insurance Company;
Bankers Standard Fire & Marine Insurance Company;
CIGNA Indemnity Insurance Company;
CIGNA Employers Insurance Company;
CIGNA Fire Underwriters Insurance Company;
Atlantic Employers Insurance Company;
CIGNA Insurance Company of Illinois;
CIGNA Insurance Company of Ohio;
CIGNA Insurance Company of Texas;
CIGNA Insurance Company of the Midwest; and
Allied Insurance Company.
The following members of the active property/casualty insurance group were assigned a Baa1 insurance financial strength rating:
CIGNA Lloyd's Insurance Company;
Illinois Union Insurance Company; and
INA Surplus Insurance Company;
Insurance financial strength ratings were confirmed at Ba1 for the following members of the Brandywine group:
Century Indemnity Company; and
CIGNA Reinsurance Company.
Moody's assigned a Ba1 insurance financial strength rating to Century Reinsurance Company, a member of the Brandywine Group.
The rating outlooks for the active and inactive property and casualty operations are stable.
CIGNA Corporation, based in Philadelphia, is a leading provider of health care, insurance, and financial services in the United States, and it is also one of the largest U.S.-based international insurance organizations. CIGNA reported consolidated assets of approximately $106 billion and shareholders' equity of approximately $8.0 billion as of September 30, 1997.
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