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Member, Beacon International Group, Ltd.
OLDWICK, N.J.Old Republic Title Insurance Group's financial strength rating was downgraded to A from A+ by A.M. Best Co. Tuesday.
The downgrading of the Minneapolis-based insurer is due to the adverse impact of its poorly performing mortgage guaranty operations and the "uncertainty surrounding the financial flexibility" of the insurer's parent, Chicago-based Old Republic International Corp., Best said in a statement.
While Old Republic Title Insurance has strong underwriting and conservative reserving practices, Oldwick, N.J.-based Best said, those positive rating factors are "partially offset by the ongoing down cycle in the real estate market."
Best added that the insurer faces challenges to achieve near-term profitability as the demand for title insurance products is derived from transactions in residential real estate.