A.M. Best Places Ratings of Subsidiaries of North Pointe Holdings Corporation Under Review With Positive Implications

  
    
  
  
    
      A.M. Best Co. has placed the financial strength rating (FSR) of 
      A- (Excellent) and issuer credit rating (ICR) of “a-” 
      of North Pointe Insurance Company (NPIC) (Southfield, MI) and 
      the FSR of B+ (Good) and ICR of “bbb-” 
      of North Pointe Casualty Insurance Company (NPCIC) (Jacksonville, 
      FL) under review with positive implications. Concurrently, A.M. Best has 
      placed the FSR of B++ (Good) and the ICR of “bbb+” 
      of Capital City Insurance Company, Inc. (Capital City) (Columbia, 
      SC) under review with positive implications. All the above companies are 
      subsidiaries of North Pointe Holdings Corporation (NPHC) 
      (Southfield, MI) (NASDAQ: NPTE).
    
    
      These rating actions follow the recent announcement that NPHC has 
      entered into a definitive agreement to be acquired by QBE Holdings, Inc. 
      (QBE) in a merger agreement. QBE is a subsidiary of Australia’s 
      QBE Insurance Group, Limited [ASX: 
      QBE.AX], a global insurer and reinsurer 
      conducting business through property/casualty insurance subsidiaries in 
      eight countries headquartered in North and South America. A.M. Best 
      expects the ICR of “bb+” 
      of NPHC to be withdrawn upon the completion of its acquisition by QBE.
    
    
      These rating actions are based on the increased financial wherewithal 
      anticipated to be available to NPHC and its subsidiaries as a result of 
      the transaction. NPHC will be a member of QBE Americas, which had in 
      excess of $2 billion in policyholders’ 
      surplus through third quarter 2007. The acquisition of NPHC is being 
      funded by existing cash held by QBE in the United States.
    
    
      The under review status takes into consideration the change in ownership 
      and the integration risks associated with this latest addition to QBE’s 
      U.S. operation. This risk is partially mitigated by the experience QBE 
      has integrating large insurance operations.
    
    
      The ratings will remain under review pending the completion of the 
      transaction, which is subject to the satisfaction of certain closing 
      conditions and is expected to close during the first half of 2008.
    
    
      For Best’s Ratings, an overview of the rating 
      process and rating methodologies, please visit www.ambest.com/ratings.
    
    
      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.