Best Affirms Seguros Inbursa Rating

October 11, 2005

A.M. Best Co. announced that it has affirmed the financial strength rating of “A” (Excellent) of Mexican insurer Seguros Inbursa, S.A. with a stable outlook.

“The rating reflects Seguros Inbursa’s solid risk-adjusted capitalization, favorable underwriting performance, strong market profile and conservative reinsurance program,” said Best. The company is a Mexican composite insurer of life and non-life business and is a member company of Grupo Financiero Inbursa, one of the largest financial groups in Mexico. “Conservative underwriting strategy and prudent expense management have resulted in favorable earnings over the past several years,” Best noted.

The rating agency indicated: “Seguros Inbursa remains one of the largest and most profitable insurers in Mexico through a combination of conservative underwriting strategies and prudent expense management. Seguros Inbursa’s ability to generate above average investment returns further enhances solid operating results. Furthermore, the integration of the company into Grupo Financiero Inbursa has resulted in synergies and improved efficiency stemming from the use of the group’s vast financial and system networks.”

Best noted, however, that “the increasingly competitive condition of the Mexican insurance market,” notably “competition from smaller insurers to gain market share and the increased number of foreign insurers in the market, has created a very competitive environment, resulting in lower rates and challenges to maintain profitability and market share.” These factors partially offset the company’s leading position.

Best also noted that Seguros Inbursa “operates in a catastrophe prone region, although a comprehensive reinsurance program with quality reinsurers mitigates this risk.”

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