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HIH Insurance NZ Welcomes Upgraded Credit Rating

MEDIA RELEASE

HIH Insurance NZ Welcomes Upgraded Credit Rating

Standard and Poor's has removed its CreditWatch Negative rating from HIH Casualty & General Insurance (NZ) Ltd (HIHNZ), the main trading entity of HIH New Zealand. It has also affirmed HIH New Zealand's A- credit rating.

This means HIHNZ now enjoys higher insurer financial strength and counterparty credit ratings than the BBB+ (CreditWatch Negative) currently assigned to its parent company HIH Insurance Limited.

The rating change is due the stand-alone financial profile of HIH NZ, including superior capitalisation and earnings.

A new legal structure has recently been put in place to ensure that HIHNZ's assets and income stream continue to support its A- ratings. A key element of the new structure is the appointment by HIHNZ of an independent prudential supervisor whose role is to ensure any distributions made to its parent company are through commercially prudent dividends.

According to HIHNZ Managing Director, Ross Chapman, HIHNZ is strong, profitable and has a sound financial base.

"We have traded profitably for a number of years, enjoying strong equity ratios and introducing new products to market," Mr Chapman said.

"We intend to further strengthen our market leadership position in professional indemnity and public liability insurance as well as our other leading corporate insurance portfolios, including property, marine and trade credit insurance.

"We expect the affirmation of our A- rating and the removal of the negative CreditWatch will be welcomed by our broker network and major clients, who value our position and the level of expertise we bring to the New Zealand market."

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HIHNZ expects to announce its results to June 30, 2000 in a few days.

HIHNZ has launched a number of innovative products in 2000 including New Zealand's first private legal aid insurance cover, an employee rights product and new products to assist employers in the wake of recent changes in the Accident Compensation Corporation area.

Other major areas of activity for HIH include trade credit insurance, director liability insurance, public liability cover, fire and general insurance and other commercial risk insurance.

Ends

Issued by HIH Casualty & General Insurance (NZ) Ltd on December 4, 2000.

For further information, please contact Mr Chapman on (09) 379 7967 or 021 965 303.

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