Abstract
Lincoln National Life Insurance And Kingsway Financial Services Inc (KFSI) rating was taken care of by A.M Best Co. KFSI is the parent company and has several subsidiaries under its flagship. The ratings were under review and several conclusions were drawn from the ratings. In most of the ratings, the grades were usually downgraded, which explains the reason for it being kept under review.
A.M Best Co as of December 2007 performed financial rating of Lincoln National Life Insurance and Kingsway Financial Services Inc. The rating reports of A.M Best Co are regarded as reliable. However, these ratings are not meant for impacting the decisions of the investors. These ratings are done to see how well prepared a company offering insurance policies is if it has to pay claim amount to the policyholders. Ratings consist of grades and different rating agencies use different symbols or phrases for grading and the meanings may also differ.
Lincoln National Life Insurance rating for assessing financial strength was changed to B++ from A-. As far as the rating for issuer credit was assigned, A.M Best Co assigned the grades “bbb”, which was earlier “a-”. Lincoln National Life Insurance is a subsidiary of Kingsway Financial Services Inc.
The rating for the parent company (Kingsway Financial Services Inc) was also done. The ICR or issuer credit rating for the parent company was changed to “bb”, which was earlier “bbb-”. The outlook of the ratings were not stable and had a negative implication and was thus under review. The same rating was also applicable for another firm belonging to the same banner, Kingsway America Inc.
KFSI or Kingsway Financial Services Inc, the parent company has the following subsidiaries and they were rated as under:
The Financial strength rating for the following subsidiaries were changed to B++ from A-. Similarly, the ICR or the issuer credit rating of the subsidiaries was changed from “a-” to “bbb”.
Universal Casualty Company
Kingsway Reinsurance (Bermuda) Ltd.
Southern United Fire Insurance Company
American Service Insurance Company Inc.
JEVCO Insurance Company
Information conveyed by the ratings:
The ratings conveyed the following information:
Development of reserves was on the contrary.
Risk adjusted capitalization was not strong.
Operating performance was not up to the mark.
Market conditions were not congenial.