Moody's Investors Service today downgraded the Performance Rating of Syndicate 435 - Faraday Underwriting - to B (average) from B+ (above average).
The rating agency said this move came amid concerns over Faraday's commitment to the Lloyd's market.
The syndicate's performance rating was put on negative outlook in November 2001, in light of Faraday announcing during the Lloyd's auctions that it would not be taking up its pre-emption on the syndicate for 2002.
Moody's summed up its motivation for the downgrade:
"Moody's considers that in light of recent results and the potential risk to policyholder continuity in transferring the business, should management seek to transfer some or all of the business outside Lloyd's, syndicate 435's position, in terms of continuity for policyholders, is more consistent with that of a B (average) performance rating and the syndicate has therefore been downgraded to B (average)."
Faraday syndicate 435 is a leading Property Casualty syndicate operating in the Lloyd's of London Insurance Market whose managing agency is owned by General Re Corporation (US), a subsidiary of Berkshire Hathaway Inc.
