A.M. Best Co. has revised the outlook to negative from stable and affirmed the financial strength rating (FSR) of B++ (Good) and issuer credit ratings (ICR) of �bbb� of National Security Group (National Security) and its member, National Security Fire and Casualty Company. A.M. Best also has revised the outlook to negative from stable and affirmed the ICR of �bb� of National Security�s parent company, The National Security Group, Inc. (NASDAQ: NSEC).

Additionally, A.M. Best has affirmed the FSR of B+ (Good) and ICR of �bbb-� of National Security�s wholly owned subsidiary, Omega One Insurance Company, Inc (Omega One). Concurrently, A.M. Best has affirmed the FSR of B (Fair) and ICR of �bb� of the life/health company, National Security Insurance Company. The outlook for these ratings is stable. All companies are domiciled in Elba, AL.

The negative outlook of National Security reflects the recent decline in its risk-adjusted capitalization and continued exposure to losses from weather-related events. The group�s negative operating performance in 2008 was largely due to a record frequency of tornado and windstorm events and hurricane losses, which are a result of National Security�s geographic and product concentration in the Gulf Coast states. However, in an effort to improve underwriting results and minimize the potential impact of future weather events, management continues to implement coastal risk reductions, higher deductibles and rate increases. Additionally, the group reported sizable unrealized capital losses resulting from unprecedented capital market volatility, which contributed to its reduction in capitalization.

The ratings of Omega One acknowledge its low underwriting leverage and generally favorable operating performance. Partially offsetting these positive rating factors is the company�s limited business profile, which leaves it susceptible to severe weather-related losses, as evidenced in 2008.

The ratings of National Security Insurance Company recognize the limited geographic profile and continued decline in its capital and surplus due to investment losses. The ratings also reflect the company�s favorable level of risk-adjusted capitalization and net operating gain recorded at year-end 2008, although the large realized capital loss at year end resulted in a net loss for the fourth consecutive year.

For Best�s Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.

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