A.M. Best Takes Various Rating Actions on Guardian General Insurance Limited and N.E.M. Insurance Limited

Business Wire, Dec 22, 2005

OLDWICK, N.J. -- A.M. Best Co. has upgraded the financial strength rating (FSR) to A- (Excellent) from B++ (Very Good) of Guardian General Insurance Limited (GGIL). Concurrently A.M. Best has downgraded the FSR to A- (Excellent) from A (Excellent), of N.E.M. (West Indies) Insurance Limited (NEMWIL) (both companies are domiciled in Trinidad & Tobago). Both FSRs have been removed from under review with negative implications and assigned a stable outlook.

These rating actions follow A.M. Best's completion of its due diligence process as the companies merged, restructured and expanded into the U.K. motor business. The expansion was accomplished through the formation of the Link Insurance Company Limited and the acquisition of Zenith Insurance Plc (UK). Each entity underwrites high end motor business in the U.K. As part of this process, GGIL received a capital contribution of approximately USD100 million from its parent company, Guardian Holdings Limited (GHL). The expansion provides GGIL with geographic diversification of its insurance risks, which formerly were concentrated entirely in the hurricane prone Caribbean region. However, A.M. Best remains concerned with GGIL's increased business volume along with execution and integration risks inherent in expanding into new markets.

The rating downgrade of NEMWIL is based on the completed restructuring of GGIL and its subsidiaries. Under the new organizational structure, NEMWIL is a wholly owned affiliate of GGIL; and, consequently retains the same rating as its parent.

GGIL and NEMWIL are wholly owned affiliates of. GHL, a publicly-traded holding company incorporated in the Republic of Trinidad and Tobago. GHL through its subsidiaries and joint ventures is engaged in the underwriting of all classes of insurance business and associated investment activities in the Caribbean and Europe.

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