A.M. Best Affirms Rating of Harbor Point Re Limited and Assigns Rating to Harbor Point Limited.

OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating (FSR) of A (Excellent) and the issuer credit rating (ICR) of "a" of Harbor Point Re Limited (Harbor Point) (Bermuda). Concurrently, A.M. Best has assigned the ICR of "bbb" to Harbor Point Limited. The outlook for all ratings is stable.

The rating affirmations reflect Harbor Point's successful first-year execution of operations within the parameters of the business plan presented to A.M. Best during last year's initial rating process, along with solid risk-based capitalization and strong market acceptance.

Formed in 2005, Harbor Point was a spin off of the reinsurance operations of Chubb Re, a subsidiary of The Chubb Corporation (Chubb) (Warren, NJ). Harbor Point was established with $1.3 billion of tangible capital and a $200 million convertible note issued to Chubb in exchange for acquired business. As part of the transaction, Harbor Point received the renewal rights to Chubb Re's existing reinsurance business, which was comprised primarily of assumed treaty reinsurance for casualty lines. Over the past year, Harbor Point has increased its property catastrophe and other short-tail lines of reinsurance business. Chubb has retained responsibility for all liabilities related to business underwritten prior to the formation of Harbor Point with claims being managed by Harbor Point pursuant to a claims services agreement.

Harbor Point successfully retained key senior management personnel from Chubb Re's operations and the existing infrastructure including back office operations, thereby providing for continuity of operations. Additionally, Harbor Point has the ability to use Federal Insurance Company (100% owned by Chubb) paper in the near term until a U.S. platform is created. Harbor Point's strengths are partially offset by increased competition and new capacity brought to market from both established and newly created companies. This additional capacity could dampen expected returns if pricing of reinsurance coverage fails to meet anticipated levels. A.M. Best will closely monitor the quarterly performance of Harbor Point against its stated business plan, and any material negative deviations in terms of management, earnings, capitalization or risk profile could result in downward pressure on the ratings.

For Best's Ratings, 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.