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OLDWICK, N.J.--([ BUSINESS WIRE ])--A.M. Best Co. has upgraded the financial strength rating (FSR) to A+ (Superior) from A- (Excellent) and issuer credit rating (ICR) to aaa-a from aa-a of Montpelier US Insurance Company (MUSIC). Both ratings have been removed from under review with positive implications and assigned a negative outlook.

"The Treatment of Terrorism Risk in the Rating Evaluation"

These rating actions follow the acquisition of MUSIC by Selective Insurance Group, Inc. (NASDAQ: SIGI), effective December 31, 2011, as well as the execution of an updated pooling agreement under which MUSIC has become a member of the pool led by Selective Insurance Company of America (SICA).

On May 27, 2011, A.M. Best affirmed the FSR of A+ (Superior) and ICRs of aaa-a of Selective Insurance Group and its seven property/casualty pooling members. The outlook for these ratings is negative.

The principal methodology used in determining these ratings is [ Bestas Credit Rating Methodology -- Global Life and Non-Life Insurance Edition ], which provides a comprehensive explanation of A.M. Bestas rating

process and highlights the different rating criteria employed. Additional key criteria utilized include: aUnderstanding BCAR for Property/Casualty Insurersa; aRating Members of Insurance Groupsa; aThe Treatment of Terrorism Risk in the Rating Evaluationa; aNatural Catastrophe Stress Test Methodologya; aRisk Management and the Rating Process for Insurance Companiesa; aCatastrophe Risk Management Incorporated Within the

Rating Analysisa; aCatastrophe Analysis in A.M. Best Ratingsa; and a[ A.M. Bestas Ratings & the Treatment of Debt ].a Methodologies can be found at [ www.ambest.com/ratings/methodology ].

Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit [ www.ambest.com ].

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