Co-op Re rating withdrawn as company winds up

Rating agency A.M. Best has withdrawn the rating of Ireland-based Co-operators of Canada Reinsurance International Ltd., assigning it an NR-3 rating in light of the decision to wind up its operations by the end of the year. Co-op Re’s assets and liabilities will be repatriated back to the group’s Canadian affiliates by the end of 2003.
The rater affirmed the “B++” (very good) rating of Co-operators General Insurance Co. and the “B+” (very good) ratings of Sovereign General Insurance Co., L’Union Canadienne Compagnie D’Assurances and COSECO Insurance Co. All have a stable outlook.
A.M. Best says Co-operators General’s rating reflects its status as the largest domestic p&c insurer in Canada, and it strong market position backed by excellent capitalization. “Management’s primary focus is to continue to improve operating performance while increasing their standing in the co-operative community by implementing rate increases, targeting preferred markets, exiting unprofitable portfolios and diversifying their product mix.”
However, offsetting these factors is the company’s exposure to troubled auto markets in Ontario and Alberta, and its limited access to new capital. “Underwriting and operating performance have shown improvement over the past year; however, the company remains challenged to produce overall profitability.”