A.M. Best has downgraded American Physicians Assurance Corporation (APA) and A.P. Specialty Insurance Corporation to "B+u" Very Good from "B++u" Very Good.
According to A. M. Best, the rating remains under review with negative implications.
Best lowered its financial strength ratings from B++ to B+ (both listed in the very good range, according to Best) for both medical malpractice carrier American Physicians Assurance Corp. (APA) and its high-risk reinsurance affiliate APSpecialty Insurance Corp.
APA is the market leader in Michigan and New Mexico, second in Illinois and fourth in Ohio and also does significant business in Kentucky, she said.
The ratings firm said APA, APSpecialty and ICA would remain under review with negative implications -- where they were placed on Nov. 6, 2003 -- pending A.M. Best's year-end 2003 assessment of each company.
Best reported that the downgrades reflect a reduction in the holding company's risk-adjusted capital and statutory surplus as a result of a $43 million ($28 million, net of tax) reserve adjustment recorded in the 2003 third quarter, the agency said in a public statement accompanying the announcement.
The group posted net losses of $62 million in 2001 and $10.1 million in 2001, according to Best. On its latest 10Q filing with the Securities and Exchange Commission Nov. 14, the holding company reported a net loss of $76.9 million on $203.5 million in income for the first three quarters of 2003.