A.M. Best Upgrades Rating of Philadelphia Consolidated Holding Corp. and Affirms the Ratings of Its Subsidiaries

  
    
  
  
    
      A.M. Best Co. has upgraded the ICR to “a-” 
      from “bbb+” of Philadelphia 
      Consolidated Holding Corp. (Philadelphia Consolidated) (Bala Cynwyd, 
      PA) [NASDAQ: PHLY] 
      and affirmed the financial strength rating (FSR) of A+ (Superior) and 
      issuer credit ratings (ICR) of “aa-”of 
      Philadelphia Insurance Companies (Philadelphia) and its members. 
      Concurrently, A.M. Best also has affirmed the FSR of A- (Excellent) and 
      ICRs of “a-” of Liberty 
      American Insurance Group (Liberty American) and its members. 
      Philadelphia Consolidated is the parent holding company of the member 
      companies of Philadelphia and Liberty American. The outlook for all 
      ratings is stable. (See below for a detailed listing of the companies 
      and ratings.)
    
    
      The ICR of Philadelphia Consolidated acknowledges its excellent balance 
      sheet strength and considerable financial flexibility. For liquidity 
      purposes, Philadelphia Consolidated maintains a $50.0 million revolving 
      credit facility, of which $15.0 million was available as of March 31, 
      2008. In addition, the two insurance companies that comprise 
      Philadelphia are members of the Federal Home Loan Bank of Pittsburgh 
      (FHLB), providing a borrowing capacity of approximately $736.9 million 
      as of March 31, 2008.
    
    
      The rating actions on Philadelphia recognize its consistently superior 
      operating results, strong capitalization and excellent market presence 
      as a writer of specialty commercial business. The ratings also 
      acknowledge the group’s excellent operating 
      cash flow, solid liquidity measures and the financial flexibility of 
      Philadelphia Consolidated.
    
    
      The rating actions on Liberty American reflect its strong capitalization 
      and adequate liquidity in support of the current plan not to renew all 
      of the Florida-domiciled group’s personal 
      lines business, except for the business it writes under the National 
      Flood Insurance Program. These positive rating factors are partially 
      tempered by Liberty American’s narrow 
      geographic concentration and the inherent susceptibility of its run-off 
      book of Florida property business to catastrophe losses.
    
    
      The ICR of “bbb+” 
      for Philadelphia Consolidated Holding Corp. has been upgraded to “a-”.
    
    
      The FSR of A+ (Superior) and ICRs of “aa-” 
      have been affirmed for Philadelphia Insurance Companies and its 
      following members:
    
    
      
        Philadelphia Indemnity Insurance Company
      
      
        Philadelphia Insurance Company
      
    
    
      The FSR of A- (Excellent) and ICRs of “a-” 
      have been affirmed for Liberty American Insurance Group and its 
      following members:
    
    
      
        Liberty American Insurance Company
      
      
        Liberty American Select Insurance Company
      
    
    
      Founded in 1899, A.M. Best Company is a global full-service credit 
      rating organization dedicated to serving the financial and health care 
      services industries, including insurance companies, banks, hospitals and 
      health care system providers. For more information, visit www.ambest.com.