CRM Holdings, Ltd. Announces Downgrade of Majestic Insurance Co. Rating By A.M. Best
18 Diciembre 2009 - 3:00PM
Business Wire
CRM Holdings, Ltd. (the “Company” or “CRMH”) (Nasdaq: CRMH)
today announced that A.M. Best Co. has downgraded the financial
strength rating (“FSR”) of Majestic Insurance Company (“Majestic”),
the Company’s primary insurance subsidiary, to B++ (Good) from A-
(Excellent) and Majestic’s issuer credit rating (“ICR”) to “bbb”
from “a-”. A.M. Best also downgraded the FSR of Twin Bridges
(Bermuda), Ltd. (“Twin Bridges”), the Company’s reinsurance
subsidiary, to B+ (Good) from B++ (Good) and Twin Bridges’ ICR to
“bbb-” from “bbb”.
“These rating actions reflect A.M. Best’s concern over the
potential impact on Majestic and Twin Bridges due to the issues
faced by their affiliates, Compensation Risk Managers LLC (“CRM
LLC”) and CRMH. The issues stem from a ’Notice of Imminent
Enforcement Action’ filed by the New York State Office of the
Attorney General, which intends to file civil claims against CRMH
and CRM LLC and certain directors and officers to seek redress of
allegedly unlawful practices. Furthermore, the New York State
Workers’ Compensation Board (“WCB”) has commenced a lawsuit against
CRM LLC and its affiliates on its behalf and in its capacity as
successor in interest to the workers’ compensation group’s
self-insurance trusts in New York, which were previously managed by
CRM LLC,” A.M. Best said in its announcement.
A.M. Best also downgraded the ICRs to “bb” from “bbb-” of CRMH,
Embarcadero Insurance Holdings, Inc. (“Embarcadero”) and CRM USA
Holdings, Inc. (“CRM USA”), and downgraded the debt ratings to “b+”
from “bb” for the trust preferred securities of CRM USA and the
surplus notes of Embarcadero.
All ratings have been placed under review with negative
implications.
"We are extremely disappointed by A.M. Best’s downgrades,
particularly because these actions were based on the Attorney
General's Notice of Imminent Action and the WCB’s lawsuit, both of
which contain allegations that we believe are without merit. We
will aggressively pursue resolution of these matters. Majestic will
continue to offer the same excellent service we have been providing
for over 20 years to our first rate broker network and their
clients.” said James J. Scardino, the Company’s Chief Executive
Officer.
A.M. Best ratings are directed toward the concerns of
policyholders and insurance agencies and are not intended for the
protection of investors or as a recommendation to buy, hold or sell
securities.
About CRM Holdings, Ltd.
CRM Holdings, Ltd. is a provider of workers' compensation
insurance products. Its main business activities include
underwriting primary workers' compensation policies, underwriting
workers' compensation reinsurance and excess insurance policies,
and providing fee-based management and other services to
self-insured entities. The Company provides primary workers'
compensation insurance to employers in California, Arizona,
Florida, Nevada, New Jersey, New York, and other states. The
Company reinsures some of the primary business underwritten and
provides excess workers' compensation coverage for self-insured
organizations. CRM is also a provider of fee-based management
services to self-insured groups in California. Further information
can be found on the Company’s website at
http://www.CRMHoldingsLtd.bm.
CRMH-E
Forward-Looking statements
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concerning plans, objectives, goals, strategies, projections of
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Although we believe that our plans, intentions and expectations are
reasonable, we may not achieve our plans, intentions or
expectations. There are or may be important factors that could
cause actual results to differ materially from the forward-looking
statements we make in this document. Such risks and uncertainties
are discussed in the Company’s Form 10-K for the year ended
December 31, 2008, and in other documents filed by the company with
the Securities and Exchange Commission.
These risks and others could cause actual results to differ
materially from those expressed in any forward-looking statements
made. The Company undertakes no obligation to update publicly or
revise any forward-looking statements made.
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