Best Assigns ‘B++’ Rating to Primary Insurance Co.

November 23, 2004

A.M. Best Co. announced that has assigned a financial strength rating of “B++” (Very Good) to Dublin, Ireland-based Primary Insurance Company Limited (PICL) with a stable outlook.

“The rating reflects PICL’s very good capitalisation and improving business profile. Offsetting factors are the company’s relatively modest business position and the impact a loan to its parent company has on its risk-adjusted capitalisation,” Best said.
“PICL’s very good risk-adjusted capitalisation reflects its unleveraged balance sheet, low risk investment portfolio (investments mainly comprise major bank deposits) and short tail underwriting exposure. A.M. Best’s assessment of the company’s risk-adjusted capital factors the existing 9.3 million euros [$12 million] redeemable loan to its parent company, including the impact that this loan has on PICL’s liquidity.”

Best noted that PICL is “a relatively small insurance company (anticipated 2004 gross written premiums of 48 million euros ($62.4 million)) with a modest profile in the United Kingdom market, where it writes most of its business.” However, Best said it “believes that PICL is likely to continue to improve its business profile through internal distribution channels, either through additional agencies acquired by its ultimate parent, Primary Group Limited (PGL), or organic growth from agencies that PGL already owns.”

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