Best Affirms Ironshore and Subs Ratings

June 23, 2011

A.M. Best Co. has affirmed the issuer credit rating (ICR) of “bbb-” of Cayman Islands-based Ironshore Inc., as well as the financial strength rating of ‘A-‘ (Excellent) and the ICRs of “a-“of Ironshore’s operating subsidiaries. These include Bermuda-based Ironshore Insurance Ltd., Minneapolis-based Ironshore Indemnity Inc., Phoenix-based Ironshore Specialty Insurance Company, and Ireland’s Ironshore Europe Ltd.

The outlook for all of the above ratings is stable.

The ratings reflect Ironshore’s “strong risk-adjusted capitalization, enhanced and developing business profile and highly experienced management team,” Best explained. Furthermore, the ratings “recognize the progress made by the organization, including optimization of distribution channels in order to view a broad spectrum of submissions, which aids the company in selecting risks.

“Ironshore continues to build out its business, and at the end of 2010 Ironshore Europe was formed, which provides the organization with a European operating platform.”

As partially offsetting these strengths Best cited “the group’s rapid pace of premium growth, particularly in casualty classes of business, during a soft phase of the casualty market. This growth creates reserve risk due to the uncertainty associated with measuring ultimate loss costs for those longer-tailed classes of business. In addition, Ironshore has continued credit risk from its dependence on reinsurance.”

Best explained that the outlook recognizes its “expectation that performance and risk-adjusted capitalization will continue to support Ironshore’s operating strategies and growth initiatives.”

Source: A.M. Best

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