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S&P Assigns 'A' pi Rating to Farmers New World Life Insurance

NEW YORK, June 22 /PRNewswire/ -- Standard & Poor's today assigned its single-'A' pi insurer financial strength rating to Farmers New World Life Insurance Co.

The company is licensed in 32 states and its major line of business is ordinary life insurance. Farmers New World Life Insurance Co. is a member of Farmers Insurance Group, a large insurance group, owned by B.A.T Industries PLC. The company commenced operations in 1911.

The following factors are incorporated in the single-'A' pi rating:

-- Under Standard & Poor's capital adequacy model, capitalization is

extremely strong, with a ratio of over 300%;

-- Operating performance is excellent, with an earnings adequacy ratio of

736%, calculated by Standard & Poor's model;

-- The company's liquidity ratio of 194.4% is considered appropriate for

this rating category. However, it may be a limiting factor in a higher

rating category; and

-- The company's rating is limited by the single-'A'-plus financial

strength rating of Farmers Insurance Group.

Ratings denoted with a 'pi' subscript are insurer financial strength ratings based on an analysis of published financial information and additional information in the public domain. The ratings do not reflect in-depth meetings with an insurer's management nor do they incorporate material non- public information, and are therefore based on less comprehensive information than ratings without a pi subscript. Pi ratings are reviewed annually based on a new year's financial statements, but may be reviewed on an interim basis if a major event that may affect an insurer's financial security occurs. The pi rating process covers U.S insurers to which Standard & Poor's previously assigned quantitative ('q') ratings, and may include information beyond that used to derive the previous quantitative-only ratings. Pi ratings are not modified with 'plus' or 'minus' designations, nor are they subject to potential CreditWatch listings, Standard & Poor's said. -- CreditWire

SOURCE Standard & Poor's CreditWire

CO: Farmers New World Life Insurance Co.; B.A.T Industries PLC

ST: New York

IN: INS FIN

SU: RTG

06/22/98 20:11 EDT http://www.prnewswire.com

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