A.M. Best Affirms Rating of Hiscox Insurance Company Limited.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Sept. 17, 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 financial strength rating of A- (Excellent) of Hiscox Insurance Company Limited (Hisco). The rating reflects the company'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 and prospective financial performance, excellent business profile with leadership in certain specialist lines and experienced management team. Offsetting factors include the company's disappointing investment return and high expense ratio. The rating outlook is stable. Excellent capitalisation--At the end of 2001, Hisco maintained excellent capitalisation, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the A.M. Best risk-based capital model. Hisco's financial flexibility is enhanced by the financial support from its parent, Hiscox plc, as indicated by a 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. 20 million (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. 29.2 million) capital injection in December 2001. Maintenance of the A- rating is predicated upon additional capital being made available to Hisco to support its expansion plans over the next two years. Excellent prospective financial performance--A.M. Best expects Hisco's pre-tax operating performance to continue to improve in 2002 (pre-tax operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. in 2001 was GBP 2.8 million [USD 4.1 million] despite a deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in total investment return to 2.1%). The company has generated pre-tax operating profits consistently since 1998. Hisco's combined ratio improved from 96.3% in 2000 to 95.8% in 2001, supported by the company's very low 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. loss ratio due to a low incidence of losses. Although progress has been made in reducing both the company's own expenses and commissions paid to intermediaries, the expense ratio has remained persistently high at 43% in 2001. Excellent business profile with leadership in specialist lines--Hisco is a market leader in high value household business and professional indemnity (PI) for service sector professions. The company is well positioned to benefit from improving household rates and average increases of approximately 30% on renewal business in the PI sector. Experienced management team--Hisco benefits from an experienced and committed management team that has a long history of service and wide management experience within Hiscox plc. Expectations: - Hisco's parent will make additional financial resources available to Hisco by 2003 in order to maintain risk-adjusted capitalisation at a level commensurate with the current rating level. - Hisco will continue to operate to a combined ratio of less than 100%. 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. |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion