claims-paying ability rating reaffirmed by Duff & Phelps Credit Rating Co.

The reaffirmed double A rating reflects ALAS' expertise in its chosen insurance market, consistent profitability, and low operating leverage, the rating agency said.

ALAS was founded in 1979 as a Bermuda mutual insurance company to provide liability insurance coverage to attorneys in the US.

Policies are issued by ALAS Inc., its wholly-owned subsidiary, that cedes all risks above $100,000 to ALAS, said the Chicago-based rating company.

Eligibility for coverage by ALAS is restricted to law firms with 35 attorneys are more.

The mutual's membership currently totals 349 firms which include more than 47,000 attorneys.

ALAS members undergo a rigorous application process, said the rating company.

Over the past ten years, ALAS has declined 61 percent of membership applications received.

At fiscal 1994 year end, November 30, the company reported $1.1 billion in assets and $169 million in members surplus.

Members' surplus declined 27 percent in 1994 due to high unrealised investment losses on fixed income investments resulting from a rise in interest rates and a large dividend distribution made to members.

Invested assets at fiscal year end totalled $522 million; 76 percent bonds, 12 percent equities and 12 percent cash and equivalents.

All fixed income investments are in investment grade securities, said the rating company.

ALAS reported net income of $39.6 million for fiscal 1994 compared to $52.1 million a year earlier.

ALAS' combined ratio, excluding policyholder dividends, over the past nine years is under 100 percent while the cumulative combined ratio since inception is 79.2 percent.