A.M. Best Co. has downgraded the financial strength rating to “B+” (Good) from “B++” (Good) and the issuer credit rating (ICR) to “bbb-” from “bbb” of Western Isles Insurance Company Limited (WIICL), which is based on the Isle of Man. Best also revised the outlook for both ratings to negative from stable.
“The rating actions reflect the weakening risk-adjusted capitalization of WIICL’s parent company, the general Russian insurer Soglassye Insurance Company LLC,” Best explained.
Best described WIICL’s capital position as “solid but declining, although still supported by “excellent operating performance and a comprehensive retrocession program.” The changed outlook “reflects the strong anticipated gross written premiums to approximately $48 million in 2007 ($37 million in 2006) and the limited profit retention, which are likely to put pressure on risk-adjusted capitalization,” Best concluded.
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