A.M. Best Affirms Ratings of Arch Reinsurance Ltd.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) for Arch 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. Ltd. (Arch) (Bermuda) and its reinsured affiliates. A.M. Best has also assigned issuer credit ratings of "a-" to Arch and its reinsured affiliates. Concurrently, A.M. Best has assigned an issuer credit rating of "bbb-" to Arch Capital Group Limited (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ACGL ACGL Arch Capital Group Ltd. ACGL Automobile Corporation of Goa Limited ACGL Alternative County Government Law ) (Bermuda) and has affirmed its senior debt rating of "bbb-" on $300 million 7.35% senior unsecured notes, due 2034. Additionally, A.M. Best has affirmed all debt securities filed under the existing shelf registrations for Arch Capital Group Limited and Arch Capital Group (U.S.) Inc. (Stamford, CT), along with the assigning of an issuer credit rating of "bb+' to Arch Capital Group (U.S.) Inc. The outlook for all ratings is stable. These ratings reflect Arch's excellent capitalization, solid operating performance and well regarded operating franchise in both its primary and reinsurance business. The company's historical and recent operating performance has been profitable, and despite third quarter 2004 hurricane losses totaling $140 million, the company expects to produce an 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 the current quarter. The combination of Arch's solid profits, strong risk management capability and demonstrated financial flexibility enabled it to withstand the heightened loss activity of this year's hurricane season Hurricane season refers to a period in a year when hurricanes usually form. For more information see: Tropical cyclone#Times of formation. For a lists of past seasons, see:
Over the past year, Arch's management has focused on its core property/casualty lines of business by enhancing its 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. and risk management control systems along with the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of non-core affiliates and lines of business. Arch's risk-based capital continues to meet the more stringent requirements established for new company formations. Arch also maintains a solid balance sheet with investments in high quality government and corporate fixed income securities. Partially offsetting these strengths is Arch's higher underwriting leverage position relative to its peer group combined with the overall casualty orientation of its reinsurance and insurance lines of business. Despite Arch's loss reserve adequacy based on current actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin studies, approximately 60% of its book of business is in long-tail casualty lines. Due to the company's relatively short operating history and long-tail nature of casualty business, the pricing and reserve adequacy of these lines will not be fully apparent for several years. A.M. Best will continue to monitor Arch's loss reserve development, capitalization and operating performance. The financial strength rating of A- (Excellent) has been affirmed and issuer credit ratings of "a-" have been assigned with a stable outlook for Arch Reinsurance Ltd. (Bermuda) and its following reinsured affiliates: --Arch Reinsurance Company --Arch Insurance Company --Arch Specialty Insurance Company --Arch Excess & Surplus Insurance Company An issuer credit rating of "bbb-" with a stable outlook has been assigned to Arch Capital Group Limited. An issuer credit rating of "bb+" with a stable outlook has been assigned to Arch Capital Group (U.S.) Inc. The following debt rating has been affirmed with a stable outlook: Arch Capital Group Limited-- --"bbb-" on $300 million 7.35% unsecured senior notes, due 2034 The following indicative shelf ratings have been affirmed with a stable outlook for debt securities available under the existing shelf registrations Arch Capital Group Limited-- --"bbb-" on senior debt --"bb+" on subordinated debt Subordinated Debt A loan (or security) that ranks below other loans (or securities) with regard to claims on assets or earnings. Also known as "junior security" or "subordinated loan". --"bb" on preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. Arch Capital Group (U.S.) Inc.-- (guaranteed by Arch Capital Group Ltd.) --"bbb-" on senior debt For current 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. , independent data and analysis on more than 470 reinsurance companies, please visit http://www.ambest.com/reinsurance/. For current Best's Ratings, independent data and analysis on more than 3,000 individual property/casualty companies, groups and industry composites, please visit http://www.ambest.com/pc For a list of A.M. Best's Debt Ratings, please visit http://www.ambest.com/debt. 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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