MOODY'S SAYS EXPOSURE TO UNICOVER CONTRIBUTED TO RECENT RATING ACTIONS ON SOME INSURANCE COMPANIES
New York, November 19, 1999 -- Moody's Investors Service has taken rating actions on a number of insurance companies associated with workers' compensation reinsurance facilities managed by Unicover Managers, Inc. The Unicover exposure was, in some cases, one of a number of credit concerns facing these companies.
The rating actions involved these companies:
Delphi Financial Group, Inc.: Senior debt of Ba1 placed on review for possible downgrade on March 5, 1999;
Fremont General Insurance Group: Insurance financial strength rating (IFSR) of A3 placed under review for possible downgrade on November 10, 1999;
John Hancock Mutual Life Insurance Company: IFSR of Aa2--outlook changed to negative on November 12, 1999;
Lincoln National Life Insurance Company: IFSR of Aa3--outlook changed to negative on November 12, 1999;
Phoenix Home Life Mutual Insurance Company: IFSR of Aa3 placed under review for possible downgrade on November 12, 1999;
Reliance Insurance Group: IFSR of Baa2 placed under review for possible downgrade on November 10, 1999;
Sun Life Assurance Company of Canada: IFSR of Aa2--outlook changed to negative on August 10, 1999.
In addition to the actions noted above, Moody's has reviewed the potential gross and net exposure of Unicover-related losses for a number of other companies with potential exposure to the Unicover reinsurance program. Based on current estimates, Moody's has concluded that the potential exposure of these companies does not currently warrant any rating action.
In some cases, the exposure does not appear to be material. In other cases, the estimated exposure may be meaningful, but Moody's believes that the company has access to sufficient resources to absorb foreseeable potential losses without substantially altering its credit profile.
The Unicover exposure of the following companies has been evaluated, but did not result in any rating action:
Allianz Life Insurance Company of North America: IFSR of Aa3;
Connecticut General Life Insurance Company: IFSR of Aa3;
Manufacturer's Life Insurance Company: IFSR of Aa2;
Reliastar Life Insurance Company: IFSR of A1.
Moody's believes that the companies cited in this press release are, undoubtedly, only a portion of the insurers that will ultimately be impacted by the Unicover workers' compensation program. This list of companies represents those rated insurers that have been cited in public documents as being involved with the Unicover facilities. There are a number of rated primary companies that are not included in this list because current estimates of their potential exposure is not deemed sufficient to warrant any rating action. Moody's will continue to monitor the situation and evaluate ratings as more information becomes available.
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