View this article online: https://www.claimsjournal.com/news/international/2008/02/14/87330.htm
A.M. Best Co. has affirmed its Syndicate Rating of ‘A’ (Excellent) and the issuer credit rating (ICR) of “a+” of Lloyd’ s Syndicate 382, which is managed by Hardy Underwriting Agencies Ltd. (HUA). Best also affirmed the ICR of “bbb” of Hardy Underwriting Group plc, the syndicate’ s immediate holding company, a s well as its debt rating of “bbb-” on the $30 million floating rate subordinated bonds issued by Hardy Group in 2006.
Best also announced that it has revised its outlook on the ratings to stable from positive, “reflecting the stable outlook on the rating of Lloyd’s of London.” In addition Best has assigned an ICR of “bbb” to Hardy Underwriting Bermuda Limited (Hardy Bermuda), the newly established ultimate holding company of the Hardy group of companies. The outlook on this rating is also stable.
Best said the ratings reflect its view that “Syndicate 382 is likely to benefit from continued financial flexibility as a wholly aligned syndicate within Hardy Bermuda. The ratings also reflect the financial strength of the Lloyd’ s market, which underpins the security of all Lloyd’ s syndicates.
“In 2007 and 2008, the syndicate is expected to maintain its good operating performance, despite weaker rating conditions in its main business lines.” Best anticipates that on an annually accounted basis, “a good, albeit higher, combined ratio in 2007 (72 percent in 2006), due in part to prior year reserve releases.” On an underwriting year basis, Best said it “expects the syndicate to return an excellent profit on capacity for the 2006 year of account of approximately 11 percent-16 percent, in line with its September 2007 quarterly return, due in part to good rating conditions, particularly in its non-marine catastrophe excess of loss account.”
As far as the due to be closed 2005 year of account is concerned, Best said the return on capacity would be around 15 percent in its opinion – “a strong forecast given the syndicate’ s exposure to U.S. property catastrophe business.”
Best concluded by expressing its belief that “Syndicate 382 has a good specialist business profile and has particular expertise in the underwriting of aviation, marine and property business. The syndicate’ s profile benefits from good diversification both geographically and by account type.”
Source: A.M. Best – www.ambest.com