A.M. Best Affirms Rating of Mapfre Re.Business Editors A.M. Best Co. has affirmed the financial strength rating of A+ (Superior) of Mapfre Re, Compania de Reaseguros, S.A. (Mapfre Re), Madrid, Spain. The rating reflects Mapfre Re's coreness to Mapfre Mutualidad de Seguros y Reaseguro (A+ Superior), the ultimate parent of Sistema Mapfre, which is the Mapfre group. Additionally, the rating factors the company's excellent capital strength, leading position in the Spanish-speaking markets and improved operating performance. One offsetting factor is the company's limited international presence outside of Spain and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . The rating outlook is stable. Mapfre Re is regarded as a core business to Mapfre Mutualidad. It plays an important role in the group's strategy, and hence, benefits from the group's brand. The company is the sole reinsurer re·in·sure tr.v. re·in·sured, re·in·sur·ing, re·in·sures To insure again, especially by transferring all or part of the risk in a contract to a new contract with another insurance company. of several units within the group (Mapfre Mutualidad, Mapfre Seguros Generales S.A., and Mapfre Caucion y Credito S.A.) Excellent capitalization--The company has an excellent capitalization on a risk-adjusted basis. Mapfre Re's comprehensive 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. program effectively mitigates the impact of its catastrophe exposures, thus protecting future earnings. Excellent business position largely in Spanish-speaking markets--In Spain, Mapfre Re is the larger of the two national players, with a market share of approximately 12%. At year-end 2001, consolidated gross reinsurance premium increased by 13% to EUR EUR In currencies, this is the abbreviation for the Euro. 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. 687.9 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. 609.5 million). This is attributable to an increase in Spanish business and increases in rates. The company has a strong presence in Latin America, a region that accounts for 33% of the total premium. Outside the Spanish-speaking markets, Mapfre Re's presence is relatively modest. In the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , the company operates through its fully owned subsidiary, Mapfre Reinsurance Corp. (MRC See Maximum return criterion. ), which has licenses in 45 states and wrote a total gross premium of EUR 54.9 million (USD 48.6 million) in 2001. Premium is expected to grow by 13%, reaching EUR 62.3 million (USD 55.2 million) in 2002, mainly due to an accelerated hardening hardening, in metallurgy, treatment of metals to increase their resistance to penetration. A metal is harder when it has small grains, which result when the metal is cooled rapidly. environment. Improved operating performance--After disappointing results in 1999 and 2000, a period of record losses for the industry, Mapfre Re made modest but positive results of EUR 0.8 million (USD 0.7 million) to the group results. Pretax operating profits 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 were EUR -2.3 million (USD -2.0 million) (including realized capital gains); the non-life loss ratio stood at 112.4% and has averaged 109.7% over the past five years. Mapfre Re is implementing an extensive restructuring of its business mix to further enhance operating efficiencies, and the underlying earnings are owing to owing to prep. Because of; on account of: I couldn't attend, owing to illness. owing to prep → debido a, por causa de the company's stricter underwriting policy, the reduction of the share of proportional business and the implementation of profitability plans. Expectations: - The company's capital base, on a risk-adjusted basis, will remain excellent. The company will continue to be supported by Mapfre Mutualidad if required. - Mapfre Re will continue to concentrate on Spanish-speaking countries while keeping its growth in Europe and slowly expanding in the United States through MRC. - Operating performance will continue to improve, fulfilling the aimed combined ratio of 103%. 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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