Best Affirms Mutuelle Centrale de Reassurance ‘A-‘ Rating; Upgrades Outlook to “Stable”

September 13, 2004

A.M. Best Co. announced that it has affirmed the “A-” (Excellent) financial strength rating of France’s Mutuelle Centrale de Reassurance (MCR). It has also changed the outlook on the company from negative to stable, “reflecting the continuing improvement in underwriting performance.”

“The rating reflects MCR’s maintenance of an excellent risk-adjusted capitalization and a very good niche business profile as reinsurer of mutual organizations within the Monceau group, a medium size mutual insurance group of which MCR is an integral member,” said Best.

The rating agency said it “expects MCR’s combined ratio to be approximately 100 percent in 2004, compared with 104.9 percent in 2003, as a consequence of its on-going underwriting discipline.” Best also noted that the company’s profitability improved substantially at year-end 2003 with a net income of 10 million euros ($12.27 million), despite a non-recurrent 8 million euro ($9.8 million) commission paid to an affiliate company, Mutuelle de l’Allier et des Regions Francaises (MARF), to restore its solvability.

“MCR derives a competitive advantage from its mutual status and exclusive reinsurance relationship with MONCEAU group and intends to further develop its market share, primarily through alliances with mutuals in France and partnerships like the one with April Group, a French medium-size insurance company,” Best’s bulletin concluded.

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