NU Online News Service, Feb. 12, 2004, 11:14 a.m. EST – The U.S. company that was just spun off from Fortis, Brussels, has a diverse but volatile mix of business.[@@]

Analysts at Moody’s Investors Service, New York, give that assessment in a comment on the firm’s decision to assign a Baa2 rating to the senior unsecured debt of the newly independent Assurant Inc., New York.

Fortis raised about $2 billion for itself last week by selling 65% of its stake in the Assurant operations through an initial public offering. Fortis kept the proceeds from the Assurant IPO to fund its operations in Europe and elsewhere.

Assurant includes property-casualty insurance and credit insurance businesses along with the Fortis Health and Fortis Benefits businesses.

Assurant itself followed up on the IPO by raising $975 million through the sale of notes due in 2014 and bonds due in 2034.

Assurant has a diverse mix of business, many sources of cash and a concentration in profitable markets where competition is relatively light, the Moody’s analysts write in the comment on their rating decision.

Assurant’s “strengths are mitigated by the volatility of Assurant’s health insurance business, the catastrophe risk inherent in the group’s specialty property business, and market and regulatory challenges in Assurant’s credit life and disability business,” the analysts write.

The analysts note that Moody’s is basing the Baa2 debt rating in part on an assumption that Assurant will report at least $250 million in 2004 statutory earnings.