A.M. Best Not To Publish Disputed Rating Of Eagle Insurance Group And Subsidiaries

Eagle Insurance Group has had its A.M. Best rating of "B++" (Very Good) changed to "NR-4" (Company Request) after Eagle's management disagreed with A.M. Best over its financial strength rating. The rating is no longer being published.

This disagreement followed A.M. Best's rating review of the Eagle Insurance Group's ultimate parent—Robert Plan Corporation and certain other insurance affiliates within the group. The parent is experiencing significant financial leverage and limited liquidity in light of its plan to buy-back remaining outside investors' common stock positions, as well as the entirety of an investor's preferred stock position.

In addition, two member companies—National Consumer Insurance Company (NCIC) and GSA Insurance Company are experiencing deteriorating underwriting results. The poor operating performance and surplus erosion of NCIC has culminated in New Jersey regulators placing NCIC under regulatory supervision and A.M. Best assigning an "E" (Under Regulatory Supervision) rating to the company recently. A.M. Best is also concerned about the ultimate development of GSA Insurance Company, after its acquisition of Maryland Casualty Insurance Company's private passenger book in New Jersey.

The "NR-4" rating applies to the lead company, Eagle Insurance Company, and four of its insurance subsidiaries—Newark Insurance Company, Colonial Indemnity Insurance Company, Urban Insurance Company and Lion Insurance Company, and GSA Insurance Company, an affiliate. The group's insurance operations consist of servicing carrier business for various assigned risk auto markets, voluntary personal auto business written in New Jersey, as well as limited commercial package and homeowners business. The "NR-4" rating also applies to Commercial Mutual Insurance Company due to Eagle Insurance Group's significant controlling interest in Commercial Mutual and common management. Commercial Mutual had been rated "D" (Poor) prior to Eagle obtaining its controlling interest in the company.