A.M. Best Affirms Ratings of Asia Capital Reinsurance Group Pte. Ltd.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and the issuer credit rating (ICR (Intelligent Character Recognition or Image Character Recognition) The machine recognition of hand-printed characters as well as machine printing that is difficult to recognize. ) of "a-" of Asia Capital 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. Group Pte. Ltd. (ACR See riser card. ) (Singapore). The outlook for both ratings is stable. The ratings reflect ACR's strong capitalization, well balanced portfolio with diversified geographic risk Geographic risk Risk that arises when an issuer issues policies concentrated within certain geographic areas, such as the risk of damage from a hurricane or an earthquake. and strong risk management capabilities. The ratings also recognize its successful implementation of the infrastructure, branding and distribution channel in the first two years of operation since 2007. ACR continues to maintain a strong capital level to meet A.M. Best's stricter risk-based capital requirements Risk-Based Capital Requirement A stated requirement of liquid reserves placed upon banks and institutions that deal in risky ventures. Notes: These requirements exist for the protection of investors who hold an interest in these types of businesses. for newly formed reinsurance companies. In general, the company has adhered to its initial five-year business plan, with some adjustments to reflect a higher premium volume coming from two newly established associated companies at the holding company: ACR ReTakaful MEA MEA Multiple endocrine adenomatosis. See Multiple endocrine neoplasia. B.S.C. (c) and ACR ReTakaful SEA Berhad. In A.M. Best's view, ACR's capitalization level has a buffer to absorb the additional risk from the higher premium exposure. ACR has demonstrated to A.M. Best that it has successfully established various systems for risk management regarding pricing, exposure accumulations and capital allocation. In addition, the company consistently reviewed the pricing adequacy for its products and the overall trend in the market. A.M. Best believes ACR could explore more business opportunities by providing additional services through translating its expertise in risk management to its clients. ACR has a well spread business composition with less than 20% of its gross premiums written When a non-life insurance company closes a contract to provide insurance against loss, the revenues (premiums) expected to be received over the life of the contract are called gross premiums written. (GPW GPW Gridded Population of the World GPW Gross Premiums Written GPW Gross Product Worth GPW Geneva Convention Relative to the Treatment of Prisoners of War, 12 August 1949 GPW General Purpose Warehouse GPW Grand Prix White (Honda) ) generated from a single market. In addition, with a capital size of 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, the company is able to tap into the Asian facultative market. Facultative business contributed approximately 40% of ACR's total GPW in fiscal year 2007-08. Offsetting factors are the competitive reinsurance market in Asia and the challenge for ACR to achieve its targeted profitability level. ACR recorded a lower than expected overall operating performance in its first two years of operation, driven by volatility in a growing book of business. Although its current capitalization is still adequate to support the ratings, a low level of profitability could slow down the company's surplus growth and create pressure on its capitalization level. Underlying profitability will become more measurable as the book gradually matures and stabilizes. A.M. Best will closely monitor ACR's overall profitability trend in the coming years. For Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. The principal methodologies used in determining these ratings, including any additional methodologies and factors, which may have been considered, can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com. |
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