CONTACTS:
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - NOVEMBER 29, 2011 12:00 AM (EST)
A.M. Best Co. has maintained the under review with negative implications status of the financial strength rating (FSR) of B++ (Good) and issuer credit rating (ICR) of "bbb" of Ansvar Insurance Limited (New Zealand) (Ansvar New Zealand). This decision follows the announcement that Ansvar New Zealand has been placed into run off by its Board of Directors.
On September 28, 2011, A.M. Best downgraded Ansvar New Zealand's FSR to B++ (Good) from A- (Excellent) and ICR to "bbb" from "a-" and placed both ratings under review with negative implications, as the company's risk-adjusted capitalization was weakened by significantly higher levels of reinsurance recoverables and the impact of multiple reinsurance deductibles following the Christchurch earthquakes between September 2010 and June 2011. The ratings remained under review while Ansvar New Zealand, its group parent, Ecclesiastical Insurance Office plc (United Kingdom), and the direct parent, Ansvar Insurance Limited (Australia), were in significant discussions regarding its capital and operational aspects.
As more concrete details on these aspects emerge following Ansvar New Zealand's most recent announcement, A.M. Best will revisit the company's ratings.
The principal methodology used in determining these ratings is Best's Credit Rating Methodology - Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best's rating process and highlights the different rating criteria employed. Additional key criteria utilized include: "Understanding BCAR for Property/Casualty Insurers"; "Understanding Universal BCAR"; and "Catastrophe Analysis in A.M. Best Ratings." Methodologies can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.