A.M. Best Assigns Rating to Through Transport Mutual Insurance Assoc. – TT EurAsia – Ltd.

December 12, 2003

A.M. Best Co. has assigned an initial financial strength rating of B++ (Very Good) to Through Transport Mutual Insurance Association (EurAsia) Limited (TT EurAsia), the London-based subsidiary of Through Transport Mutual Insurance Association (TT Bermuda). The two companies collectively trade as the TT Club. The outlook is stable.

The rating reflects the company’s excellent risk-based capitalization, very good business profile and solid financial performance. A.M. Best regards TT EurAsia as a core subsidiary of TT Bermuda. An offsetting factor is the high reliance on reinsurance coverage.

Excellent risk based capitalization – TT EurAsia’s capitalization, measured by A.M. Best’s risk-adjusted capital model, is expected to remain excellent through 2004 as a result of low premium retention (approximately 20 percent), a conservative investment strategy and solid projected retained earnings.

Very good business profile – The company has a very good business profile, providing tailored insurance packages for TT Club’s members located outside the Americas. Business lines include the insurance and reinsurance of members’ equipment, ships, property and liabilities for loss and damage to cargo. TT EurAsia operates closely with its parent, TT Bermuda – currently rated B++ (Very Good).

Solid financial performance – TT EurAsia has a very good track record of profitability (achieving operating profits in each of the last eight years), a trend that is likely to continue as the company benefits from its expertise across its portfolio. A combined ratio in the region of 90 percent is expected at year-end 2003 and 2004, subject to normal loss experience.

Reliance on reinsurance cover – The company is highly dependent on the pricing and availability of reinsurance coverage, reflected by the cession of approximately 80 percent of its gross premium income. A.M. Best will closely monitor the company’s maintenance of high quality coverage going forward, although any concerns are partially mitigated as the company has in place multi-year quota share policies with a number of high quality reinsurers.

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