A.M. Best Affirms Rating of London General Insurance Company Limited.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of B++ (Very Good) of London General Insurance Company Limited (LGI LGI Leeds General Infirmary (UK) LGI Law Governed Interaction LGI Law-Governed Interaction LGI Local Government Institute LGI Deadmans Cay / Long Island, Bahamas - Deadmans Cay (Airport Code) ) (United Kingdom), which is ultimately owned by Aon Corporation. The rating outlook remains stable. The rating reflects LGI's strong market position, solid operating performance and very good risk-adjusted capitalisation supported by solid net retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. . An offsetting factor is the impact on sales from the potential commission disclosure that could result from the Office of Fair Trading's current review of creditor products. LGI maintains a strong position in certain niche sectors including extended warranty The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , creditor protection insurance and technology insurance. A.M. Best believes that LGI's gross written premium is likely to increase marginally to 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. 330 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. 574 million) at year-end 2005 (compared to GBP 327.5 million (USD 631 million) in 2004), as the production of two new contracts will be replacing the premium lost due to LGI's decision in 2004 to pull out of a large contract and the cancellation of a fronting agreement. However, the sales of the new products introduced last year are likely to remain below original expectations. The combined ratio will decline by seven percentage points to approximately 75%, largely due to lower acquisition expenses driven by the structure of the new business partnerships. Financial performance is expected to remain solid, and A.M. Best anticipates retained earnings to improve to approximately GBP 8 million (USD 14 million) at year-end 2005 (compared to GBP 7 million (USD 13.6 million) in 2004). A.M. Best believes that LGI's risk-adjusted capitalisation will improve as the reduction in 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. recoverables leads to a reduction in credit risk. 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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