S&P Assigns 'Api' Rtg to Federated American Insurance

Business Wire, Sept 9, 1998

NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 9/9/98 --Standard & Poor's today assigned its single-`Api' insurer financial strength rating to Federated American Insurance Co.

The company is licensed in Washington and Oregon. Its major line of business is private passenger auto liability, and it is a member of Credit Suisse Group, one of the world's largest financial services enterprises. The company commenced operations in 1959; and the principle state in which it operates is Washington. In 1997, the company sold its National Merit Insurance Co. and Gemco Enterprises Inc. subsidiaries to its parent, Unigard Inc.

The company participates in an inter-affiliate pooling agreement led by its sister company, Uniguard Insurance Co. Under the 1998 pooling agreement, the company retains a 4% share of the pooled business, and therefore is assigned the rating of its sister company.

`Pi' ratings, denoted with a pi subscript, are insurer financial strength ratings based on an analysis of an insurer's published financial information and additional information in the public domain. They do not reflect in-depth meetings with an insurer's management and are therefore based on less comprehensive information than ratings without a 'pi' subscript. Pi ratings are reviewed annually based on a new year's financial statements, but may be reviewed on an interim basis if a major event that may affect the insurer's financial security occurs. Ratings with a pi subscript are not subject to potential CreditWatch listings.

Ratings with a pi subscript generally are not modified with 'plus' or 'minus' designations. However, such designations may be assigned when the insurer's financial strength rating is constrained by sovereign risk or the credit quality of a parent company or affiliated group, Standard & Poor's said. -- CreditWire

CONTACT: Ronald S Lettofsky, New York, 212/208-1742

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