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A.M. Best places Intact Insurance Group’s financial strength rating under review


June 7, 2011   by Canadian Underwriter


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A.M. Best has placed the financial strength rating of ‘A+’ (Superior) of Intact Insurance Group, under review with negative implications.
Intact Insurance Group members include Belair Insurance Company, Intact Insurance Company, Novex Insurance Company, The Nordic Insurance Company of Canada and Trafalgar Insurance Company.
The rating action follows the announcement that Intact will purchase AXA Canada.
“The under review status with negative implications reflects IFC’s increased financial leverage position under the proposed financing structure, relative to the current rating level and outlook,” an A.M. Best release says.
“In addition, there is potentially a considerable amount of execution risk associated with the integration of approximately $2 billion of AXA’s direct premiums written into the Intact Financial Corporation organization, which has approximately $4.5 billion of direct premiums written within the Intact Group.”
The ratings will remain under review until the completion of the transaction, scheduled in Fall 2011.


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