A.M. Best Affirms Rating for Ansvar

September 9, 2004

A.M. Best Co. has affirmed the financial strength rating of B++ (Very Good) of Ansvar Insurance Company Limited (Ansvar) (United Kingdom). The outlook remains stable.

The rating reflects Ansvar’s very good capitalization, improved underwriting performance and strong business profile. An offsetting factor is the potential difficulty the company may have in maintaining rates during the soft market.

A.M. Best believes Ansvar is likely to maintain its very good capitalization and improved underwriting performance, with the combined ratio likely to remain below 90% for the next two years. Ansvar’s risk-adjusted capitalization has been maintained at a very good level over 2003, aided by increased retention of earnings following an excellent year, which resulted in after tax profits of GBP 2.1 million (USD 3.7 million) compared to GBP 943,000 (USD 1.5 million) the previous year.

Ansvar also benefits from a strong business profile within the niche not-for-profit market (particularly insurance of church and charities) and is deemed by A.M. Best to have strategic importance to its parent, Ecclesiastical Insurance Office (EIO).

A.M. Best believes Ansvar may have difficulty in maintaining rates during the soft market, although the company is protected to some degree from price-driven competition due to the specialist nature of its business and its high retention rates.

A.M. Best Co., established in 1899, is the world’s oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best’s Web site at http://www.ambest.com.

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