While SCPIE has indicated that its fourth-quarter results will include an underwriting loss of roughly $55 million, producing a "substantial net loss" for the quarter and the year, MIIX did not provide any preliminary estimates.

MIIX said only that the company will report a loss and that it expects to complete year-end financial statements within two weeks.

"The extent of the loss will depend upon the results of the Company's ongoing actuarial analysis," MIIX said.

In a statement, MIIX's president and chief executive officer, Patricia Costante, said that while the company "dramatically altered" its business plan at the end of 1999, reserve studies are indicating that "further aggressive actions" are needed.

She said the company has made progress in "reducing exposures, re-underwriting the entire book of business, increasing rates, eliminating discretionary discounts and developing a strong risk-adjusted bottom line focus."

One of the aggressive actions being worked into a "new operating plan" that is still being developed will be to put its Lawrenceville Property and Casualty Company operations into run-off. Lawrenceville will cease writing business in all states in which it operates, including Texas, Ohio, Massachusetts, Illinois and Virginia, and its regional offices supporting marketing and underwriting operations in those states will be closed, she said.

Ms. Constante said MIIX expects to focus ongoing operations on the New Jersey physician market and that it may continue operations in other Mid-Atlantic States where profitability and a strong strategic fit are established.

"We are very aware of the substantial disappointment resulting from this news to investors and the company's several other constituencies, including most particularly our insureds and employees, and we take very limited comfort knowing that we are not alone among insurers in facing disappointment at this time.

"We believe strongly that the best approach is to face the reality squarely and to respond aggressively to build a restructured platform that will allow the company to operate profitably," she said.

She also said that the company is in discussions with regulators and A.M. Best about the new operating plan.

This morning, however, A.M. Best downgraded the financial strength rating of MIIX Group to "B-minus" (fair) from "A-minus" (excellent). The rating action applies to MIIX Insurance Co. and its two subsidiaries, Lawrenceville Property & Casualty Co. and MIIX Insurance Company of New York, Best said, noting that the rating remains under review with negative implications.

In its statement, SCPIE said the 2001 losses reflect reserve strengthening in the fourth quarter of about $50 million, in addition to $30 million in reserve strengthening implemented in the second quarter.

SCPIE's fourth-quarter and full-year results will not be finalized until SCPIE's external auditors complete their 2001 annual audit. The audit is scheduled to be completed during the first week of March, the company said, noting that it anticipates announcing final results on or about March 12.