AM Best has downgraded the financial strength rating of PXRE to B++ (Very Good) from A- (Excellent) and the issuer credit ratings (ICR) to "bbb" from "a-".
The downgrades follow PXRE's announcement that it increased its net loss estimates for hurricanes Katrina, Rita and Wilma by a pre-tax amount between $281m - $311m.
AM Best said it now has greater concern regarding PXRE's risk management capability as a result of the magnitude and composition of this most recent loss revision and with consideration of the company's longer-term track record.
AM Best said the ratings have been assigned a negative outlook until new strategies and risk mitigation procedures that PXRE is implementing, have been fully tested.
