U.S. insurer failure rate on the decline: S&P

The rate of failure for U.S. insurers has been on the decline since 2000, and last year reached its lowest level since 1996, says Standard & Poor’s.In a special report, S&P notes 19 insurers were placed under regulatory supervision in 2004, compared to 28 in 2003 and 39 in 2002. Just 13 p&c insurers were placed under supervision last year, compared to 20 the year prior, and 28 in 2002.On average, p&c insurers make up 60% of insurer failures, although this figure reached 68% in 2004.S&P says it did not rate 17 of the 19 insurers who failed last year, and the two who were rated were graded below the secure ("BBB") level. 2004 also saw the gap between the number of upgrades and downgrades narrow, with 90 downgrades versus 60 upgrades for interactively rated companies.