Standard & Poor’s Ratings Services has lowered its counterparty and financial strength ratings on Allianz Insurance Co. of Canada and Trafalgar Insurance Co. of Canada.

The ratings remain on CreditWatch with developing implications, where they were placed on Oct. 8, 2004.

The rating agency says that this action follows discussions with ING Canada, which purchased the two insurance companies last month.

“Initial discussions indicate that one or both of the purchased entities might have its policies rewritten in ING Canada or affiliates in the near future,” said Standard & Poor’s credit analyst Michael Gross.

Standard & Poor’s says that it is uncertain regarding ING Canada’s strategic intent and what group resources are available to benefit the acquired companies. It has decided to maintain its CreditWatch Developing status on both entities as discussions with ING Canada continue about the future of the two acquired companies.