A.M. Best Affirms Ratings of Aspen Specialty Insurance Company
October 06 2010 - 1:36PM
Business Wire
A.M. Best Co. has affirmed the financial strength rating
of A (Excellent) and issuer credit rating of “a” of Aspen
Specialty Insurance Company (ASIC) (Bismarck, ND), a wholly
owned subsidiary of its ultimate parent, Aspen Insurance
Holdings Limited (Aspen) [NYSE: AHL]. The outlook for both
ratings is stable.
The ratings reflect ASIC’s role and strategic importance to
Aspen’s overall strategy and the explicit support provided through
substantial quota share reinsurance of ASIC’s net business by its
Bermuda-based affiliate, Aspen Insurance Limited (AIL), in
addition to the guarantee of all third-party reinsurance
recoverables. ASIC’s balance sheet is further protected by an
adverse development cover for the company’s outstanding loss
reserves as of December 31, 2008. The ratings also reflect the
implied support of future parental commitment.
ASIC maintains strong stand-alone capitalization, driven by its
low underwriting leverage and negligible investment leverage, and
solid liquidity. However, the current competitive market presents a
significant challenge to a company still seeking to firmly
establish itself in the surplus lines/specialty market.
The principal methodology used in determining these ratings is
Best’s Credit Rating Methodology -- Global Life and Non-Life
Insurance Edition, which provides a
comprehensive explanation of A.M. Best’s rating process and
highlights the different rating criteria employed. Additional key
criteria utilized include: “Risk Management and the Rating Process
for Insurance Companies”; “Understanding BCAR for Property/Casualty
Insurers”; and “Rating Members of Insurance Groups.”
Methodologies can be found at
www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is a global full-service
credit rating organization dedicated to serving the financial and
health care service industries, including insurance companies,
banks, hospitals and health care system providers. For more
information, visit www.ambest.com.
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