A.M. Best Affirms Financial Strength Rating of Converium Group and Its Core Subsidiaries.Business Editors/Insurance Writers OLDWICK, N.J.--(BUSINESS WIRE)--Aug. 29, 2003 A.M. Best Co. has affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. the financial strength rating of A (Excellent) of Converium Group (Converium) (Switzerland) and its core subsidiaries. (See list below.) A.M. Best's debt rating on the USD USD In currencies, this is the abbreviation for the U.S. Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 200 million senior unsecured notes due in October 2023 was revised to "bbb" from "a-" on August 22, 2003, as a result of a change in A.M. Best's debt rating criteria. (See August 22 press release, A.M. Best Revises Debt Ratings Following Changes to Debt Criteria). The outlook for all the ratings is stable. The ratings are based on Converium's excellent capitalisation n. 1. same as capitalization. Noun 1. capitalisation - writing in capital letters capitalization writing - letters or symbols that are written or imprinted on a surface to represent the sounds or words of a language; "he turned the paper , improving performance, enhanced profile in certain reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. classes and conservative investment strategy. An offsetting factor is the potential for further adverse development in Converium's consolidated net technical reserves. Excellent capitalisation -- Although under some pressure at year-end 2002, A.M. Best expects Converium's prospective risk-adjusted capital to be maintained at an excellent level based on conservative assumptions for performance in 2003 and 2004. Failure to maintain a consolidated capital base at a level commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with the current financial strength rating would trigger an immediate review of Converium's ratings. Improving performance -- A.M. Best expects Converium's consolidated non-life combined ratio to be below 100% in 2003 and 2004 (subject to normal loss experience), based on profitable growth in net written premium in current favourable underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. conditions. Converium's underlying performance improved in 2002, despite the impact of adverse reserve development and has continued this trend in the first half of 2003. The half year 2003 net non-life combined ratio is 99%. Enhanced profile -- Converium has successfully raised its profile in liability reinsurance business written outside North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and in certain specialty lines, including aviation and space, agribusiness agribusiness Agriculture operated by business; specifically, that part of a modern national economy devoted to the production, processing, and distribution of food and fibre products and byproducts. and other weather-related products. There has been substantial growth in the volume of business written in Converium's target areas. For example, in Converium's Zurich business segment, liability net premium written increased 68.3% in 2002 to USD 381.4 million. Adverse development in net technical reserves -- A.M. Best believes there continues to be potential for further adverse development in Converium's consolidated net technical reserves, largely as a result of uncertainty surrounding the appropriate level of reserves required for casualty business written in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. between 1997 and 2000. However, in 2003 and 2004, A.M. Best expects any adverse development to be more than offset by improvement in the performance of calendar year business written. At year-end 2002, Converium reported consolidated adverse non-life reserve development of USD 148.5 million, which follows deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. of USD 123.6 million in 2001. A.M. Best is currently reviewing the core status of all Converium's rated subsidiaries. The financial strength ratings of A (Excellent) of the following companies have been affirmed with a stable outlook: -- Converium Ltd, Switzerland -- Converium Rueckversicherung (Deutschland) AG, Germany -- Converium Reinsurance (North America) Inc. -- Converium Insurance (North America) Inc. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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