View this article online: https://www.insurancejournal.com/news/international/2005/11/08/61673.htm
A.M. Best Co. announced that it has affirmed the financial strength rating of “A” (Excellent) and assigned an issuer credit rating of “a” to National Grid Insurance Company (Isle of Man) Limited (NGICL), formerly known as NGT Insurance Company (Isle of Man) Limited, a captive of National Grid plc. The outlook for both ratings is stable.
Best said it “believes NGICL’s risk-adjusted capitalisation and strong risk management are supportive of the current rating. In the unlikely event of a major catastrophe, NGICL is protected by an extensive reinsurance programme with highly rated reinsurers. However, such an event could expose the company to a significant liquidity and credit risk.”
The rating agency also indicated that it “expects NGICL’s earnings to be significantly impacted by favourable loss reserve development of previous underwriting years resulting in strong profits of approximately £15 million ($26.1 million) at year-end March 2006. The company’s underlying operating performance is strong as a consequence of the low loss frequency resulting from strict risk assessment. However, the nature of the risks written by NGICL (electricity and gas transportation infrastructures) exposes operating results to potential volatility.”