In accordance with the Insurance Companies (Ratings and Inspections) Act 1994, please be advised that on Monday, 9 July 2007, A.M. Best Co., Oldwick, New Jersey, United States of America, gave Pioneer Insurance Company Limited (New Zealand) a financial strength rating of B (fair) from B+ (good).
The revised rating reflects the company's risk-adjusted capitalisation due to internal control failures, in particular, the allegations of fraud perpetrated by a former employee of Pioneer Insurance Company Limited.
CU Securities Limited, a company backed by the
New Zealand Association of Credit Unions, acquired Pioneer Insurance Company Limited on Friday, 6 July
2007, and has since recapitalised the company by an injection of $6.5 million.
The rating will remain under review pending discussions with management with the expectation of receiving an upgraded rating once a full business plan for Pioneer Insurance Company Limited's future operations has been submitted to the rating agency.
The rating schedule is available for inspection at Pioneer Insurance Company Limited, 42 Tennyson Street, Napier,
or on our website
www.pioneerinsurance.co.nz