A.M. Best Co. has assigned a financial strength rating of ‘A’ (Excellent) and an issuer credit rating of “a” to Bermuda-based Starr Insurance & Reinsurance Limited (SIRL), an indirect wholly owned subsidiary of Panama-based Starr International Company, Inc. (SICO), a private investment holding company. The outlook for both ratings is stable. “SIRL currently participates in quota-share reinsurance programs, most of which are managed by a group of specialized insurance agency subsidiaries of Starr Underwriting Agencies, LLC (SUA), a subsidiary of C.V. Starr & Co., Inc.,” Best explained. “The programs focus on specialty commercial lines and global catastrophe reinsurance. SIRL expects to participate in additional programs throughout its initial operating period.” Best added that the “ratings reflect SIRL’s sound business plan, solid risk-adjusted capitalization, its existing relationships with other parties to the programs in which SIRL participates and the quality of those other participants. SIRL benefits from the management, underwriting, claims handling and loss control expertise provided by the SUA agencies. While it is expected that the diversification of SIRL’s business across several commercial lines will reduce the impact of any specific event on the company, SIRL has purchased third-party reinsurance to limit its net exposures on a per risk basis and to catastrophic events.” However, Best also indicated that the “above strengths are somewhat offset by the execution risk associated with expanding SIRL’s operations, the potential impact of market conditions on the company’s current and potential business and the uncertainties related to outstanding legal issues involving SICO and certain members of its leadership team, as well as the reduction in SICO’s shareholder’s equity due to realized and unrealized investment losses in 2008. While SIRL has established relationships with several key participants in its target markets, its ability to build and maintain market share will have to be proven over time.” Best said it would continue to monitor the Company.
A.M. Best Co. has upgraded the financial strength rating to ‘A+’ (Superior) from ‘A’ (Excellent) and the issuer credit rating to “aa-” from “a+” of Canada’s Temple Insurance Company, and has revised its outlook on both of the ratings to stable from positive. Best indicated that in its opinion, ” the ratings and outlook reflect Temple’s excellent capitalization, consistently solid operating performance and benefits from its strategic affiliation with Munich Reinsurance Company of Canada and its ultimate parent, Munich Reinsurance Company (Germany). Temple’s earnings continue to be solid as evidenced by favorable underwriting and investment income, as well as improved pure loss ratios. In addition, Temple maintains a conservative reserve philosophy as evidenced by consistent redundancies on both an accident and calendar year basis. Temple has a solid business profile, focusing its book of business on liability and commercial property coverage, while also abiding by its plan to be a writer of niche type business.” Best added that it also believes “Temple’s operating philosophy will remain prudent, the company will face many challenges to maintain overall profitability levels due to soft market conditions and intense competition in Canada.”
Was this article valuable?
Here are more articles you may enjoy.