A.M. Best downgrades outlook for QBE's financial strength rating
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A.M. Best Europe revised the outlook for the financial strength rating of Australia's QBE Insurance Group Ltd. to negative from stable, the A.M. Best Co. Inc. subsidiary said Thursday.
At the same time, the financial strength ratings of A for QBE operating units QBE Insurance (Europe) Ltd.; QBE Re (Europe) Ltd.; and QBE Insurance (International) Ltd. were affirmed, the rating agency said in a statement.
However, A.M. Best Europe also downgraded QBE's the issuer credit rating and senior debt ratings to bbb from bbb+ as well as the debt ratings of the insurer's perpetual preferred securities to bb+ from bbb-, A.M. Best Europe said in the statement.
The move comes after Sydney-based QBE's Monday announcement that it expects a loss of approximately $250 million for fiscal year 2013 “due mainly to claims provisioning and intangibles and goodwill writedowns in North America” according to QBE in its statement to the Australian Securities Exchange, and Wednesday's downgrade by fellow ratings agency Fitch Ratings Inc.
“The negative outlook on the ratings reflects the uncertainty surrounding QBE's future performance and financial flexibility,” A.M. Best said in its statement.
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