Are you using firefox 3?
Continuously Disconnected and losing all my points in Live chat

You should download the new Firefox3, much better then Internet Explorer and does not disconnect as often although they are working on the problem.

this is what you should have read when you logged in to this chess server,
PLEASE READ! DO NOT USE LIVE CHESS unless you understand that it is still a work-in-progress. You MAY be disconnected randomly. You MAY experience lag. You WILL be disappointed if you expect anything else. For the BEST EXPERIENCE on Live Chess we recommend that you use Firefox 3, Safari 3, or Chrome. Internet Explorer browser does not perform well in Live Chess. Seriously, try !
We are working really hard on making Live Chess as fast, stable, and amazing as possible. In the mean time, please be patient - thanks!

This is a problem that is being worked on. However, you have to bear with this situation. Are you using one of the suggested alternatives to Internet Explorer. I do emphasize with your problem.

Yeah, I get many disconnects despite having fast cable internet. In fact I just got disconnected now (the reconnect dialog also doesn't work for me but reload does). It's really annoying and unfortunately there is no resume. However, it is beta so such kinks are expected.

It happens both ways. Another small problem is that the lag correction does not work well. I made my first two moves with premove and I still lost two seconds. I just lost a game due to lag. A move showed up in my GUI and was made with premove but I still lost on time. It can be frustrating in blitz. I'm going to let Live Chess bake for a while longer.

its the third time that i disconnect any time and my rating slow down. what i have to do with my rating?
I understand your frustration, but in the end it's just an online rating. It's not like they're messing with your national or FIDE ratings. You can either put up with it or use the other services like FICS, ICC, Playchess, InstantChess, etc.
This morning I could not connect. I connected and I see in every game I am disconnected after 5-10 moves and I lose my points. Its 7th game or more I am experiencing this. I see net connection in my end is fine why should that.. Ant suggestion to avoid this issue.