OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has affirmed the financial strength rating (FSR) of A+ (Superior) and issuer credit ratings (ICR) of "aa-" of Intact Insurance Group (the Group) (Toronto, Ontario). The Group is the former ING Canada Group and includes Belair Insurance Company Inc. (Montreal, Quebec), Intact Insurance Company (formerly ING Insurance Company of Canada), Novex Insurance Company (formerly ING Novex Insurance Company of Canada), The Nordic Insurance Company of Canada and Trafalgar Insurance Company of Canada. Additionally, A.M. Best has affirmed the ICR of "a-" and assigned indicative debt ratings of "a-" on senior unsecured debt securities, "bbb+" on subordinated unsecured debt securities and "bbb" on Class A preferred shares included in the CAD 2 billion Preliminary Short Form Base Shelf Prospectus issued May 13, 2009 of Intact Financial Corporation (IFC) [TSX:IFC]. IFC is the former ING Canada Inc. and the Group's holding company. All companies are domiciled in Toronto, Ontario, unless otherwise specified. The outlook for all ratings is stable.

The ratings are reflective of the Group's superior capitalization, above average profitability and strong business profile as the largest non-government property/casualty insurer in Canada. In addition, the Group benefits from internal investment and claims management and a knowledgeable executive management team experienced in growth through acquisitions. The Group maintains advantages over its competitors in pricing and risk selection due to its superior size, geographic and product line diversification as well as its multi-channel distribution network and sound catastrophe management. Furthermore, the Group operates under a participation agreement, spreading net underwriting risks to each participating company based on fixed percentages, achieving a pooling effect through inter-company reinsurance.

The ratings also take into consideration the debt-free balance sheet of IFC and its financial flexibility to raise capital through either debt or equity offerings to pursue acquisitions or for general corporate purposes.


Partially offsetting these strengths is the Group's declining earnings trend due to investment market turbulence, rising claims costs and below average interest rates.

The Group also is being challenged by soft commercial lines pricing, above average property losses from weather-related events, deterioration in the Ontario auto market and ongoing legal challenges to regulated automobile product reforms in various provinces. These concerns are partially mitigated by the actions of management to reduce its exposure to volatile equity investments, improved personal property risk segmentation, increased premium rates and the market knowledge and experience of localized management teams working within a unified structure.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.





A.M. Best Co.

Analysts:

Charles M. Huber, 908-439-2200, ext. 5122

charles.huber@ambest.com

or

Joseph A. Burtone, 908-439-2200, ext. 5125

joseph.burtone@ambest.com

or

Public Relations:

Jim Peavy, 908-439-2200, ext. 5644

james.peavy@ambest.com

or

Rachelle Morrow, 908-439-2200, ext. 5378

rachelle.morrow@ambest.com

Source: A.M. Best Co.