A.M. Best Announces New Canadian P/C Rating Classification

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OLDWICK, N.J., 2002 — A.M. Best Co., the global insurer ratings and
information provider, announces an enhancement to its financial strength rating analysis
with the introduction of Best’s Public Data Ratings. These ratings are being applied to
the Canadian insurance market. Public Data Ratings will be identified by a “pd” modifier.

A “pd” rating is used by A.M. Best to describe the long-term financial
strength of an insurer or reinsurer. A.M. Best will use the same rating scale and
definitions as it does for its long-term financial strength interactive ratings, but will
apply a “pd” rating modifier to ensure the user is aware of the more limited
information basis for the rating.

An interactive A.M. Best rating is produced at the request of the insurer. The rating
process includes detailed interviews of senior management and access to non-public data
and other information. Information on issues which there would typically be only limited
information in the public domain play a significant part in the interactive rating
analysis. A.M. Best interactively rates the majority of insurers in Canada.

For the remaining companies, A.M. Best is restricted to publicly available information
as a basis for its rating opinion. The analysis behind “pd” ratings seeks to
incorporate all relevant information available on the insurer in the public domain. As
with A.M. Best’s interactive rating process, “pd” ratings incorporates a review
of balance sheet strength, operating performance and business profile. Moreover, A.M.
Best’s “pd” rating analysis reflects knowledge of the company’s peers, the
market sector(s) in which the company operates and the strategic and financial outlook for
those sectors. In addition, the “pd” rating is based on a detailed review by a
committee of experienced A.M. Best insurance analysts. They present the most informed view
A.M. Best can offer, short of an insurer participating in the full interactive rating process.

Previously, A.M. Best assigned Best’s Qualified Ratings to insurers in Canada that had
not participated in an A.M. Best interactive rating process. Best’s Public Data Ratings
will now replace Best’s Qualified Ratings.

A.M. Best Co. has affirmed, downgraded or upgraded the Public Data ratings for 42
Canadian property/casualty companies and has assigned initial Public Data ratings to two.

The following 29 property/casualty companies had their ratings affirmed:

  • Alberta Motor Association Insurance Company B++pd
  • Alpha, Compagnie d’Assurances Inc. (L’) B++pd
  • B.C.A.A. Insurance Corporation B+pd
  • Canadian Northern Shield Insurance Company B++pd
  • Canassurance General Insurance Company Inc. B++pd
  • Capitale Assurance Generales Inc. (La) A-pd
  • Glengarry Farmers’ Mutual Fire Insurance Company B++pd
  • Grain Insurance and Guarantee Company B+pd
  • Groupe Estrie-Richelieu Compagnie D’Assurance (Le) B++pd
  • Howick Mutual Insurance Company B+pd
  • HSBC Canadian Direct Insurance Incorporated B+pd
  • Le Mans Re B+pd — Legacy General Insurance Company B++pd
  • London and Midland General Insurance Co. B++pd
  • Maritime Insurance Company Limited B++pd
  • Mutual Fire Insurance Company of B.C. B++pd
  • North Waterloo Farmers Mutual Insurance Company B+pd
  • Northern Indemnity Inc. A-pd
  • Pacific Coast Fishermen’s Mutual Marine Ins. Co. B++pd
  • Pictou County Farmers’ Mutual Fire Insurance Co. B+pd
  • Pool Insurance Company B+pd
  • Prince Edward Island Mutual Insurance Co. B++pd
  • Red River Valley Mutual Ins. Company B++pd
  • Saskatchewan Mutual Insurance Company B++pd
  • Southeastern Mutual Fire Insurance Company B+pd
  • SSQ, Societe D’Assurances Generales Inc. B++pd
  • West Elgin Mutual Insurance Co. B++pd
  • West Wawanosh Mutual Insurance Co. B+pd
  • Western Surety Company B++pd

The following 11 property/casualty companies had their ratings downgraded:

  • British Aviation Insurance Company Ltd. Bpd
  • CAA Insurance Company B+pd
  • CUMIS General Insurance Company B-pd
  • Eagle Star Insurance Company Limited B+pd
  • Farmers’ Mutual Insurance Co. (Lindsay) B+pd
  • Hamilton Township Farmers Mutual Fire Ins. Co. B+pd
  • Industrial-Alliance General Insurance Company B-pd
  • Loyalist Insurance Company Bpd
  • Peace Hills General Insurance Company B-pd
  • Portage la Prairie Mutual Insurance Co. B+pd
  • Stanley Mutual Insurance Company B+pd

The following two property/casualty companies had their ratings upgraded:

  • Algoma Mutual Insurance Company B+pd
  • Heritage General Insurance Company B++pd

The following two property/casualty companies have been assigned public data ratings:

  • Orleans General Insurance Company B+pd
  • Antigonish Farmers’ Mutual Fire Insurance Company B+pd

A.M. Best Co., established in 1899, is the world’s oldest and most authoritative
insurance rating and information source.