A.M. Best Affirms Rating of TT Club and Revises Outlook to Positive; Assigns Issuer Credit Rating.OLDWICK, N.J. -- 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 B++ (Very Good) of Through Transport Mutual Insurance Association Ltd (TT Bermuda) (Bermuda) and its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , Through Transport Mutual Insurance Association (EurAsia) Ltd (TT EurAsia) (United Kingdom). The two companies collectively trade as TT Club. The outlook has been revised to positive from stable. At the same time, A.M. Best has assigned an issuer credit rating of "bbb+" to both companies. The outlook for this rating is also positive. The ratings reflect TT Club's significant improvement in consolidated 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. performance, resulting in higher risk-adjusted capitalisation from 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. and a strong business position as a specialist marine insurer. The ratings of TT EurAsia reflect A.M. Best's opinion of the company as an integral part of TT Bermuda's worldwide strategy. The change of outlook reflects A.M. Best's expectation that the current ratings could be reassessed once TT Club has demonstrated a consistent track record of strong earnings. TT Club's continued efforts to revise the quality of its business portfolio, which has included the cancellation of unprofitable policies combined with stable rating conditions has resulted in a better than expected underwriting performance (a 25 percentage point decline in the combined ratio to 77% at year-end 2004). A.M. Best expects TT Club to maintain its underwriting standards throughout 2005, and this is likely to lead to a combined ratio of approximately 85% despite an anticipated softening of rates of approximately 5%. Strong retained earnings (return on net premium of 38% in 2004) are further strengthening TT Club's risk-adjusted capitalisation after factoring higher capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. from the planned increase in net retention to approximately 60% in 2005. TT Club is a leading specialist insurer and risk manager for the international transport and logistics industry, and A.M. Best believes that it has a strong business position in its niche market A niche market also known as a target market is a focused, targetable portion (subset) of a market sector. By definition, then, a business that focuses on a niche market is addressing a need for a product or service that is not being addressed by mainstream providers. . Gross premium written is likely to remain stable at approximately 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. 185 million in 2005 as expansion in the Asia Pacific region is likely to offset any softening of the market. 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 http://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 http://www.ambest.com. |
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