NEW YORK - Standard & Poor's has affirmed its AA-plus rating for claims-paying ability of PMI Mortgage Insurance Co.
The rating is based on the company's strong capital position relative to a low risk profile and continued excellent operating performance, S&P said. The agency added that PMI had significantly improved the geographical diversification of its risk exposure.
The S&P announcement said, "In 1994, PMI discontinued its mortgage pool insurance operations and reduced its exposure to such risk by creating a new triple-A mortgage reinsurance company, with the help of then parent company, Allstate Insurance Co.
"The new company, Forestview Mortgage Insurance Co., now reinsures all of PMI's mortgage pool insurance and has no other business purpose. Forestview has sufficient capital and support from Allstate and a reinsurance treaty with Capital Reinsurance Co. to maintain triple-A insurance coverage on all of the mortgage pool policies originated through, or committed to, by PMI."
Without the drag of pool insurance losses, PMI's 1994 operating performance rose dramatically over 1993 levels, despite a slowdown in new insurance written, S&P said.