View this article online: https://www.insurancejournal.com/news/international/2011/03/21/190834.htm
A.M. Best Co. has affirmed the financial strength ratings of ‘B++’ (Good) and issuer credit ratings of “bbb” of National General Insurance Corporation (NAGICO) N.V. (NAGICO) (St.
Maarten) and Nagico Insurance Company Limited (NICL) (Anguilla). The outlook for all ratings is stable. The ratings reflect NAGICO and NICL’s “common ownership, adequate consolidated risk-adjusted capitalization, NAGICO’s dominant market presence in its domestic market and both companies’ overall profitability in recent years,” said Best. “NAGICO is the leading property/casualty insurer in St. Maarten with a dominant market share in the Dutch Caribbean, while NICL is one of the leading insurers in several overseas markets.” Best added that on an individual and consolidated basis, the companies “continue to report overall operating profits. Given their common parent company’s minimal dividend requirements, both NAGICO and NICL have been able to enhance its capitalization through the retention of earnings. Consequently, both companies continue to maintain more than adequate risk-adjusted capitalization for their current business profiles. In addition, NAGICO and NICL have implemented adequate risk management policies and procedures to assess and manage risks throughout their operations.” As offsetting factors Best cited the “increasingly competitive regional markets in which NAGICO and NICL operate and the limited financial flexibility of both companies as a result of their private ownership structure. Both NAGICO and NICL, like other regional insurers, have significant exposure to catastrophic losses, and the companies manage this risk through the utilization of reinsurance to limit their catastrophe exposure to a manageable level and protect their surplus against frequency of events.”
A.M. Best Co. has affirmed the financial strength rating of ‘A-‘ (Excellent) and issuer credit rating of “a-” of Bermuda-based Transmonde Services Insurance Company, Ltd., both with stable outlooks. The ratings of Transmonde reflect its “minimal underwriting leverage, strong level of capitalization and profitable operating results driven by its excellent underwriting performance,” Best explained. As offsetting factors Best noted Transmonde’s “relatively high retentions and concentration in liability lines with significant loss severity potential and its limited market profile as a single parent captive. Transmonde provides professional, general and pollution liability coverages to members of the International Association of Superintendents, which are subsidiaries of SGS SA (SGS) [SWX: SGSN], a publicly traded Swiss company.” Best also observed, however, that Transmonde has “maintained very conservative underwriting leverage ratios as surplus has consistently grown to support its business volumes. The company has posted low loss and loss adjustment expense ratios, reflecting SGS’ effective risk management. Transmonde’s relatively high per occurrence retentions are mitigated by significant deductibles and conservative reserving practices. The ratings recognize the company’s balance sheet strength and conservative underwriting leverage measures as well as Transmonde’s role as the captive insurance company of SGS.”