Best Assigns ‘A’ Ratings to Aspen American Insurance Company

November 30, 2010

A.M. Best Co. has assigned a financial strength rating of ‘A’ (Excellent) and an issuer credit rating of “a” to Dallas-based Aspen American Insurance Company (AAIC), a wholly owned subsidiary of its ultimate parent, Aspen Insurance Holdings Limited. The outlook assigned to both ratings is stable.

The ratings of AAIC largely reflect its “role and strategic importance to Aspen’s overall U.S. strategy and the explicit support provided through substantial quota share reinsurance of AAIC’s net business by its Bermuda-based affiliate, Aspen Insurance Limited (AIL),” Best explained.

The report also noted that in addition “AIL provides a guarantee of all of AAIC’s third-party reinsurance recoverables.”

The ratings also reflect Best’s expectation concerning the company’s ability to successfully execute a business plan “targeting specific, identified programs focused on certain niche classes of specialty admitted business.

As offsetting factors Best cited the “considerable challenges and execution risk associated with a start-up company, especially one seeking to establish itself in the current specialty admitted marketplace. The strategies that will drive AAIC’s day-to-day operations have been developed with the guidance of the Aspen management team, which has generated a strong track record of producing favorable results with its non-domestic operating entities, AIL and Aspen Insurance UK Limited.

Source: A.M. Best

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