A.M. Best Affirms Rating of Cornhill.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 10, 2002 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 A++ (Superior) financial strength rating of Cornhill Cornhill can refer to:
The group rating reflects Cornhill's status as a core subsidiary of its ultimate parent, Allianz Aktiengesellschaft, which recognises the company's prospective contribution to the overall group and the parent's commitment to maintain a strong market presence in the UK. The rating also factors Cornhill's good business position in the UK domestic commercial and personal lines markets, improving 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. performance, and improving 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 . Offsetting factors are Cornhill's continuous under-achievement of Allianz's profitability targets and its relatively modest risk adjusted capital-base. Key rating factors: Core subsidiary of Allianz--A.M. Best's regards Cornhill as a core entity to its ultimate parent. The group has established significant resources to restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and capitalising the operation to ensure it becomes profitable. A.M. Best will be closely monitoring Cornhill's relationship with its parent. Good business position--Cornhill is the fifth largest general insurer An individual or company who, through a contractual agreement, undertakes to compensate specified losses, liability, or damages incurred by another individual. An insurer is frequently an insurance company and is also known as an underwriter. in the UK based on 2000 net written premium. It achieved significant increases in premium rates in most business lines during 2000 and 2001. In its commercial lines business, A.M. Best believes Cornhill's market profile is enhanced by its association with Allianz. Weak but improving operating performance--Overall financial performance in 2000 was weak with a pre-tax loss (prior to equalisation Noun 1. equalisation - the act of making equal or uniform equalization, leveling human action, human activity, act, deed - something that people do or cause to happen reserve movements) of GBP GBP In currencies, this is the abbreviation for the British Pound. 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. 96.6 million (GBP 4.8 million profit in 1999) mainly due to non-life underwriting losses (GBP 167.9 million) and unrealised losses on investments (GBP 82.3 million in the non-life portfolio). A.M. Best believes Cornhill's prospects of improving its underwriting performance are good, partly due to better market conditions and increasing emphasis at Cornhill on underwriting discipline and withdrawal from the worst underperforming sectors. Improving capital position--Recent capital injections by Allianz of a total GBP 155 million have improved a relatively modest stand-alone capital adequacy. However, this increase in paid-up capital Paid-Up Capital The total amount of shareholder capital that has been paid in full by shareholders. Notes: Paid-up capital is essentially the portion of authorized stock that the company has issued and received payment for. will be partly offset by a further retained loss for 2001 and planned increases in premium income for 2002. Expectations: -- Exposure to potential claims from the World Trade Center attacks is highly unlikely to have a material impact on 2001 profitability. -- Underwriting performance will be aided by further restructuring of the portfolio to eliminate loss-making lines and further increases in premium rates. However, the company will find it difficult to achieve an overall technical underwriting profit in the next two years due to the high proportion (46%) of UK personal lines business in the overall book and the still overly competitive outlook for this sector. 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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