AM Best has downgraded the financial strength ratings of Churchill's parent company Winterthur to A (Excellent) from A+ (Superior).
The move comes as speculation mounts over the insurer's future, with both Churchill and its parent refusing to comment on whether it is to be sold off.
AM Best said the rating actions reflect the deterioration in its risk-adjusted capitalisation, which was greater than expected.
The rating agency recommended that the company explore further synergies and efficiencies should be generated through the merger of the property casualty and life operations in all markets except Switzerland and the UK.
