Agencies Lower UnumProvident Ratings One Notch

But, even if UnumProvident had to write off $628 million in speculative-grade securities that have been sitting in the "gross unrealized loss" column for at least 181 days, the write-off would not push the Fitch ratings down more than two notches, Fitch says.

S&P notes that UnumProvident has a strong position in the U.S. disability insurance market and strong cash flows, and Fitch and S&P both emphasize that UnumProvident has no debt maturing until 2005.

"Standard & Poor's believes that these strong fundamentals will be the reasons that Unum will be able to get the capital it seeks shortly, although coverage is likely to be relatively low with the expected high costs of capital," S&P says.

UnumProvident put out a statement saying that the current A ratings from Fitch and S&P are reflective of its current strong financial strength.

"We are also pleased that both agencies expressed confidence in our ability to execute our capital plan, and maintain the A rating once it is successfully completed," the company says.

Investors reacted to the ratings news by pushing the price of UnumProvident shares up 6.29%, to $6.93.