A.M. Best Co. Friday affirmed financial strength ratings of B-plus-plus and assigned issuer credit ratings of "bbb" to both Trustmark Insurance Co. in Lake Forest, Ill., and Trustmark Life Insurance Co.
It also has assigned a bb-minus debt rating to Trustmark Group Inc.'s issuance Thursday of $75 million of trust-preferred securities that mature in 2035. The securities' floating rate is equal to the three-month London interbank offered rate for the related quarter, plus a margin of 3.55 percentage points. All these ratings have a negative outlook, according to the Oldwick, N.J., ratings agency.
An unfavorable interim ruling by an arbitration panel this year concerning Trustmark's participation in a troubled workers' compensation reinsurance pool from 1997 is reflected in its negative outlook for the ratings, A.M. Best said. It added that the trust-preferred offering should enhance Trustmark Group's financial flexibility and let it better withstand any adverse outcome in the reinsurance dispute.
