INSURANCE BRIEFS

INSURANCE BRIEFS

AMERICAN RE CORP

RATED 'A-' BY S&P

NEW YORK - Standard and Poor's raised its subordinated debt rating of American Re Corp., the holding company parent of American Re-Insurance, to its seventh highest "A-" from "BBB+." The outlook is positive, the rating firm said.

Additionally, S&P assigned a "BBB+" preferred stock rating to American Re Corp.'s proposed issuance of Quips, or cumulative quarterly income preferred securities, through its American Re Capital subsidiary. The proceeds of this offering will be a minimum of $210 million, $150 million of which will be used to retire remaining senior bank debt with $50 million to be contributed to the American Re-Insurance operating company.

The rating firm also affirmed the "AA" claims-paying ability rating on American Re-Insurance Co.

GUILD TO PAY PREMIUMS

FOR DETROIT STRIKERS

DETROIT - The announcement that the Newspaper Guild Local 22 will pay August health insurance premiums for striking workers who are picketing, handing out leaflets and performing other duties came as welcome news for many.

The announcement was made at a union meeting Sunday evening.

Six unions representing 2,500 workers went on strike July 13 at the Free Press, owned by Knight-Ridder Inc., and the Detroit News, owned by Gannett Co. Inc.

The companies had paid the July premiums before the strike began, said Lou Mleczko, president of Newspaper Guild Local 22.

JAPAN MINISTRY TO SHIFT

INVESTMENT STRATEGY

TOKYO - Japan's Posts and Telecommunications Ministry intends to invest postal insurance funds in real estate in addition to safe financial operations such as local government bonds, ministry officials said Monday, according to Kyodo news service.

The ministry has restricted the investments to the government's fiscal investment and loans programs, bank deposits and local government bonds under a law on investment of postal insurance funds.

The officials said the ministry will coordinate with the Finance Ministry on a plan to submit legislation for revising the law to the Diet next January.

Despite the proposed change in the law, the ministry will avoid speculative investments in real estate and promote long-term investments to avoid risk, the officials said.

WHITE MOUNTAINS TO BUY

SKANDIA'S VALLEY UNIT

ALBANY, Ore. - Valley Insurance Group of Albany is being sold to White Mountains Insurance Co. of Hanover, N.H., for $37.8 million.

The deal with Skandia America Corp. of Sweden, Valley's parent, is subject to approval by the state Insurance Division.

Valley Insurance has about 235 employees in Albany and Sacramento, Calif. Last year, the firm sold more than $65 million worth of personal and commercial property and casualty insurance in Oregon, Washington and California.

Tom Kemp, chairman of White Mountains, said the deal includes acquisition of the Charter Group in Texas, which specializes in nonstandard automobile insurance.

White Mountains is a wholly owned subsidiary of Fund American of Norwich, Vt., a financial holding company and formerly the parent of Fireman's Fund Insurance Co.

NEW COMPENSATION LAW

UNDER FIRE IN UTAH

SALT LAKE CITY - A new law aimed at making sure one-person businesses and small-time contractors are covered by workers compensation is not going over well with some of the people it was meant to protect.

Truckers, electricians and subcontractors, who can no longer choose to be uninsured, say costly workers compensation premiums will put them out of business.

Under the law that took effect May 1, builders and others who hire independent contractors must verify that anyone working for them is covered or pay for the contractor's insurance themselves.

They also are grumbling about the new statute.

Still others are mad that farmers and real estate agents and brokers remain exempt from all workers compensation laws in Utah.

Lawmakers who passed the law without much debate early this year are trying to broker a compromise.