Kemper Insurance Companies. (Other Rating News).(Brief Article)

National Underwriter Property & Casualty-Risk & Benefits Management, April, 2003

Fitch Ratings has downgraded the insurer financial strength ratings of three primary insurance underwriters of the Kemper Insurance Companies (KIC) to 'CC' from 'B '. Additionally, Fitch has downgraded the surplus notes issued by group member Lumbermens Mutual Casualty Company to 'C' from 'CCC'.

All ratings have been removed from Rating Watch Negative. Fitch's concerns regarding the financial condition of KIC are evidenced by the decline in consolidated policyholders' surplus caused by adverse prior year loss development, additional funding obligations for KIC's pension plan, and significant realized investment losses. Included in these concerns is the increasing likelihood that interest payments on Lumbermen's surplus notes may not be made as scheduled.