I have a 200 amp main breaker panel and I am installing a 200 amp auto transfer switch. The SEU cable comes out of the panel and feeds into the transfer switch first the to the main panel. My question is if the transfer switch is hit first does that make the main panel a sub panel. Basically should I treat the transfer switch the same as a service disconnect. If it is a sub I would have to seperate the grounds and the neutrals and feed the main panel with SER cable.

Yes the ATS will now be the main and the neutrals and grounds at the old panel will need to be isolated.

Question for you, is this a "Service Rated" transfer switch?

It must be in order to install it as you describe.

I believe it is service rated it is a generac 200 amp transfer switch model 06435
http://www.guardiangenerators.com/support/guardian_transfer_switch.asp

I am not sure that what you linked to is service rated.

I would expect to see accessible disconnect switches to kill the power, it looks like you need a screw driver to open them.

The page mentions UL 1008 Listed which is just a transfer switch listing not necessarily a "Service Rated" transfer switch.

Before purchasing this switch you want to be sure.

I don’t believe the transfer switch you are proposing to use is rated for use as service entrance equipment. It does not have provisions for a bonding jumper and doesn’t have a means to disconnect the control conductors going to the generator. If you use this switch you should install a service disconnect before the switch. The other model that Generac has listed on that page (Service Disconnect Transfer Switch) might be listed for service equipment but I’m not sure. The Generac reps I have talked to don’t recommend using that transfer switch since the only way to access the service disconnect is to un-bolt and remove the front cover. Apparently many of the users that have used this switch have had inspectors reject the installation.

Curt