A.M. Best Affirms Rating of Credit & General Insurance Limited; Assigns Issuer Credit Rating.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and assigned an issuer credit rating of "a-" of Credit & General Insurance Limited (CGIL CGIL Confederazione Generale Italiana del Lavoro (Italian General Confederation of Labor) ) (New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. ). The outlook for both ratings is stable. The ratings reflect CGIL's prudent risk-adjusted capitalization, favorable underwriting experience and strong liquidity. Best's Capital Adequacy Ratio Capital adequacy ratio (CAR), also called Capital to Risk (Weighted) Assets Ratio (CRAR)[], is a ratio of a bank's capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss. (BCAR BCAR Brunswick County Association of Realtors BCAR British Civil Airworthiness Requirements BCAR Bullitt County Animal Rescue (Shepherdsville, KY) BCAR Business Case Analysis Report BCAR Beaver Creek Array BCAR Buffalo Civic Auto Ramps, Inc. ), which measures capitalization on a risk-adjusted basis, indicates that CGIL is adequately capitalized as of fiscal year-end Fiscal Year-End The completion of a one-year, or 12-month, accounting period. Notes: The reason that a company's fiscal year often differs from the calendar year and does not close on Dec 31, is due to the nature of company's needs. 2006. CGIL's capital and surplus increased by 23.2% in 2006. The company's strong underwriting performance with favorable claims experience over the last few years contributed to a steady increase in its risk-adjusted capitalization. CGIL's loss ratio deteriorated to 14.9% in 2006 from 11.7% in 2005; however, the expense ratio increased slightly during the year. CGIL's investment portfolio was liquid with cash and cash equivalent instruments representing more than 95% of the company's assets on March 31, 2006. The conservative investment holdings have enabled the company to generate a stable stream of investment income. Offsetting factors include CGIL's exposure to concentration risk in its lines of business and its limited distribution channel. CGIL's growth is dependent upon the future operating performance of Farmers Retail Business, as CGIL primarily relies on Farmers' stores to acquire business. Going forward, CGIL's narrow product range, along with concentration risk in its distribution channel, could limit CGIL's growth potential. For Best's Ratings Best's rating A rating A.M. Best Co. assigns to insurance companies based on the company's ability to meet its obligations to its policyholders. , an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. 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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