A.M. Best has affirmed the financial strength rating (FSR) of ‘A’ (Excellent) and the issuer credit ratings (ICR) of “a+” of Hiscox Insurance Company (Bermuda) Limited, UK-based Hiscox Insurance Company Limited (Hisco), Hiscox Insurance Company (Guernsey) Limited and Hiscox Insurance Company, Inc. (HICI), which is based in Chicago.
Best has also affirmed the ICR of “bbb+” of Hiscox Ltd (Hiscox) (Bermuda), the ultimate parent holding company of the Hiscox group of companies.
The outlook for the all of these ratings is stable.
In addition best said it has affirmed the FSR of ‘A’ (Excellent) and the ICR of “a+” of Lloyd’s Syndicate 33, which is managed by Hiscox Syndicates Limited (HSL). The outlook for both ratings remains positive.
The ratings of Hiscox, Hiscox Bermuda and Hisco “reflect the Hiscox group’s strong consolidated risk-adjusted capitalization and robust performance record, as demonstrated by an average five-year combined ratio of 88 percent,” Best said.
The report also noted that “Hiscox pursues a successful strategy of balancing volatile international catastrophe and large loss-exposed insurance and reinsurance business with more stable local retail business, which has supported its profitable performance in each of the past five years.”
In Best’s view “prospective performance is expected to remain good, although a return to average catastrophe experience and continued weaker pricing in the reinsurance sector are likely to lead to lower earnings, compared with the strong years of 2012-2014.
“The ratings of Hiscox Bermuda and Hisco factor in the strategic importance of both companies to the Hiscox group. Each company has established a track record of good operating performance and has made a positive contribution to overall earnings during the past five years.
“Hiscox Guernsey and HICI receive explicit support from Hiscox Bermuda in the form of reinsurance protection.
“The affirmation of the ratings of Lloyd’s Syndicate 33 reflects the underlying strength of the Lloyd’s market, as well as the syndicate’s strong performance record and enhanced financial flexibility from the support of Hiscox, which provides 72.5% of the syndicate’s capacity through its corporate member.”
Source: A.M. Best
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