Bermuda specialty property and casualty insurer, Oil Insurance Ltd., was yesterday given a Aa3 rating for one of its notes raising a quarter of a billion dollars by Moody's Investors Service.

The company, which has been given an "outlook stable" classification, will use the money raised by the notes for general corporate purposes and repayment of a commercial paper programme.

The ratings agency announced the assignment was for $250 million of extendible floating rate notes which have an initial 13 month maturity which can be extended monthly at the option of investors for an additional month, a five-year final maturity and rank senior to Oil's policyholder liabilities.

And if an investor decides not to extend maturity, the principal amount of notes held by that investor will be due and payable on the initial maturity date, or any later date to which the maturity of those notes had been previously extended, which generally will be 12 months after the date of non-extension, said Moody's in a statement.

It added that Oil is offering the notes only to qualified institutional buyers under Rule 144A of the Securities Act of 1933.

"The net proceeds from the offering will be used for general corporate purposes, including the repayment of outstanding commercial paper issued under Oil's $200 million US commercial paper programme," said the release.