Moody's has downgraded the long-term debt and insurance financial strength ratings of Chubb to Aa2 from Aa1.
Following today's announcement that the company is looking to improve its finances by raising new capital, Moody's set the outlook for Chubb's ratings to stable.
Moody's claimed the rating downgrades are based largely on the effect of the company's volatility on its recent operating performance.
Calling for the company to shore up its balance sheet, the ratings agency suggested the insurer's continued underwriting exposures to catastrophe-related claims are hampering its position.
A Moody's statement said: "The company's results in 2001 were heavily impacted by losses relating to the September 11 tragedy and to the bankruptcy of Enron Corporation.
"Following those events, Chubb re-capitalized its insurance operations through the issuance of senior debt, resulting in an increased financial leverage profile and debt service burden for the holding company."
