Commerce Group Rating Goes Negative
Credit rating group A.M. Best Co. has revised its outlook for Webster-based insurance company Commerce Group from stable to negative based on weakened capitalization of Commerce's parent organization Mapfre S.A. of Spain.
A.M. Best also affirmed a financial strength rating of A+ and an issuer credit rating of aa- for the company and its subsidiaries. It said Commerce's capitalization is reduced but still solid, and it has a strong operating performance and local expertise.
But it also said the company's ratings were hurt by its concentration of business in Massachusetts and its limited product scope, focused on car insurance.
Mapfre's revenues for the first quarter of 2009 were up 8.7 percent to 5.4 billion euros from the same quarter last year, while its net profit rose 0.2 percent to 287 million euros.
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