Best’s News & Research Service - June 25, 2014 11:14 AM (EDT)
A.M. Best Affirms Ratings of Assurances Mutuelles de France
- June 25, 2014 11:14 AM (EDT)
London //BestWire// - A.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of "a" of Assurances Mutuelles de France (AM) (France). The outlook for both ratings remains stable.
The ratings of AM benefit from the financial strength of société de groupe d'assurance mutuelle (SGAM) Covéa, a leading insurance group in France, of which AM is an affiliate member. Following an internal restructuring, SGAM Covéa's financial flexibility improved with the creation of the intermediate holding company, Covéa Coopérations, under which the operating entities of the Covéa group are gathered. At year-end 2013, AM owned 14.41% of Covéa Coopérations. The benefits of the membership in SGAM Covéa include the ability to provide financial support to its members. The SGAM members include La Garantie Mutuelle des Fonctionnaires, MAAF Assurances, MAAF Santé, MMA IARD Assurances Mutuelles, MMA Vie Assurances Mutuelles and DAS Assurances Mutuelles, in addition to AM.
The ratings of AM also reflect its excellent risk-adjusted capitalisation after taking into consideration the investments in affiliated companies, chiefly Covéa Coopérations. Although these investments have decreased since the SGAM Covéa's internal restructuring in 2012, they still represent more than 40% of AM's total assets.
In addition, the ratings factor in AM's modest business profile as a following reinsurer on treaties, and moderate expectations for its future performance after achieving a solid net income of EUR 60.1 million in 2013, mainly driven by an exceptional result of EUR 47.4 million.
Upward pressure on the ratings is unlikely at present.
Downward pressure on the ratings could be triggered by a change in the stand-alone fundamentals of AM, a re-assessment of the level of support provided by SGAM Covéa, or deterioration in the credit fundamentals of SGAM Covéa.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
In accordance with Regulation (EC) No. 1060/2009, the following is a link to required disclosures:A.M. Best Europe - Rating Services Limited Supplementary Disclosure.
This rating announcement has been issued by A.M. Best Europe - Rating Services Limited, which is a subsidiary of A.M. Best Company. A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.