A.M. Best Affirms Ratings of Northbridge Affiliates; Revises Outlook to Positive

Business Wire, June 28, 2005

OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength ratings (FSR) of A- (Excellent) and has assigned issuer credit ratings (ICR) of "a-" to the companies comprising Northbridge Financial Corp. (Northbridge) (Toronto). These companies include Commonwealth Insurance Company (Vancouver) and its U.S. based subsidiary, Commonwealth Insurance Company of America (Seattle), Federated Insurance Company of Canada (Winnipeg), Lombard General Insurance Company of Canada and Markel Insurance Company of Canada (both of Toronto). The rating outlook for the FSRs has been revised to positive from stable, while the ICRs have been assigned a positive outlook.

A.M. Best has also affirmed the FSRs of A- (Excellent) and assigned ICRs of "a-" to Lombard Insurance Company and Zenith Insurance Company (both of Toronto). These ratings have a stable outlook. Additionally, A.M. Best has assigned an ICR of "bbb-" with a positive outlook to Northbridge.

These ratings reflect the group's excellent capitalization, favorable underwriting and operating performance and its strong business franchise in the Canadian insurance marketplace. After a successful realignment of underwriting and business focus, overall underwriting and operating experience has trended favorably. Furthermore, the Northbridge companies greatly benefit from management expertise and synergies derived from the other companies.

The primary offsetting rating factor is the competitive conditions in the Canadian property/casualty marketplace. Moreover, the group will be challenged along with the industry to maintain underwriting discipline as market conditions continue to soften. In addition, the group will be challenged in the foreseeable future to offset underwriting experience in its personal lines companies relative to auto.

For Best's Ratings, an overview of the rating process and rating methodologies, please visit http://www.ambest.com/ratings.> For current Best's Ratings, independent data and analysis on more than 3,000 individual property/casualty companies and A.M. Best groups, please visit http://www.ambest.com/pc.> A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at http://www.ambest.com.