A.M. Best Comments on The Doctors Company, An Interinsurance Exchange’s Proposed Acquisition of FPIC Insurance Group, Inc. ...
26 Mayo 2011 - 2:58PM
Business Wire
A.M. Best Co. has commented that the issuer credit rating
(ICR) of FPIC Insurance Group, Inc. (Jacksonville, FL)
[NASDAQ: FPIC] is unchanged following the announcement that its
ultimate parent company has entered into a definitive agreement to
be acquired by The Doctors Company, An Interinsurance
Exchange (The Doctors Company). The financial strength rating
(FSR) of A- (Excellent) and ICR of “a-” of FPIC Insurance
Group (FPIC) and its members also are unchanged, as are the FSR
of A- (Excellent) and ICR of “a-” of FPIC Insurance Group, Inc.’s
separately rated subsidiary, Advocate MD Insurance of the
Southwest, Inc. (Advocate MD) (Austin, TX).
As one of the nation’s leading writers of medical professional
liability and the nation’s largest physician owned medical
liability writer, The Doctors Company should help augment FPIC’s
proven commitment to provide exceptional product and service
capabilities to its core clients. Over the last four years, The
Doctors Company has acquired other similar companies and has
assimilated the business and operational risks of those entities
into its organization successfully, without any decline in the
level of service provided. FPIC has benefited from the modest
financial leverage and considerable financial flexibility of its
publicly-traded parent to date. A.M. Best expects FPIC to continue
benefiting from the debt-free balance sheet and substantial
financial wherewithal of its new ultimate parent.
The ratings are unchanged due to FPIC’s stand-alone attributes
including its strong risk-adjusted capitalization, favorable
operating performance, specialty expertise and leading position
within the medical liability insurance market. Advocate MD also
maintains strong capitalization, in addition to historically
generating organic earnings and producing high policyholder
retention levels. Like FPIC, Advocate MD should benefit from the
balance sheet strength of The Doctors Company, the commitment of
its new parent to serving Advocate MD’s core client base of
physicians in Texas, and to a lesser degree, those in Mississippi.
Conversely, FPIC and Advocate MD should help The Doctors Company
expand its geographic footprint.
The principal methodology used in determining these ratings is
Best’s Credit Rating Methodology -- Global Life and Non-Life
Insurance Edition, which provides a
comprehensive explanation of A.M. Best’s rating process and
highlights the different rating criteria employed. Additional key
criteria utilized include: “Rating Members of Insurance Groups”;
“Risk Management and the Rating Process for Insurance Companies”;
“A.M. Best Ratings & the Treatment of Debt”; and “Understanding
BCAR for Property/Casualty Insurers.” Methodologies can be found at
www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and
most authoritative insurance rating and information source. For
more information, visit www.ambest.com.
Copyright © 2011 by A.M. Best Company,
Inc. ALL RIGHTS RESERVED.
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