The outlook of First Jersey Casualty Insurance Co. has been downgraded to “negative,” from “stable,” according to A.M. Best Co.

The ratings service at the same time affirmed the financial strength rating of “B+” (Good) and issuer credit rating of “bbb-” for the Clifton, N.J.-based property-casualty insurance company.

The ratings service said the negative outlook reflects FJCIC’s significant underwriting and operating losses in 2009.

“The poor performance was caused by adverse loss reserve development, primarily on the 2003 to 2007 accident years, for which FJCIC maintained excess of loss reinsurance,” according to an A.M. Best statement.

The ratings service said it is concerned that a continuation of recent operating losses could cause a decline in FJCIC’s risk-adjusted capitalization to a level of capitalization not commensurate with its current ratings.

The ratings also recognize FJCIC’s adequate capitalization, which benefited from a $1 million equity infusion in 2009, and the long-standing relationship FJCIC has with its affiliated agency, Restaurant Coverage Associates, according to the statement.