A.M. Best Affirms Ratings of Beazley Group plc and Lloyd's Syndicates 623/2623.

OLDWICK, N.J. -- A.M. Best Co. has affirmed the Best's Syndicate Rating of A (Excellent) and the issuer credit rating (ICR) of "a+" of Lloyd's Syndicate 623 and Lloyd's Syndicate 2623 (collectively referred to as syndicate 623/2623), which are both managed by Beazley Furlonge Limited. At the same time, A.M. Best has affirmed the ICR of "bbb+" of Beazley Group Plc (Beazley) (United Kingdom), the non-operating holding company of the Beazley group of companies, and the debt rating of "bbb-" on the USD 18 million floating rate subordinated notes due 2034 issued by Beazley. The outlook for all ratings remains stable.

Syndicates 623 and 2623 underwrite business at Lloyd's in parallel, with premium income split in line with total capacity of GBP 220 million (USD 385 million) and GBP 522 million (USD 914 million) respectively in 2005. Syndicate 623 is supported by third-party capital providers, while syndicate 2623 is backed by Beazley's own Lloyd's corporate capital provider, Beazley Underwriting Limited (BUL).

The ratings reflect the financial flexibility provided to syndicate 623/2623 by Beazley, a publicly listed company. BUL will increase its participation on syndicate 623/2623 to 78% of the combined capacity in 2006, up from 70% in 2005. This will be supported by a letter of credit facility for up to GBP 150 million (USD 262 million) and will contribute to an increase in combined capacity to GBP 830 million (USD 1,452 million) in 2006, up from GBP 742 million (USD 1,298 million) in 2005. The increase in capacity will enable syndicate 623/2623 to take advantage of improving market conditions following the 2005 U.S. hurricanes. Additionally, the syndicate benefits from the financial strength of the Lloyd's market which underpins the security of all Lloyd's syndicates.

A.M. Best forecasts solid profits, after personal expenses, for syndicate 623/2623 of approximately 14% of capacity for 2003 year of account and 7% for 2004, in line with the syndicate's September 2005 Quarterly Monitoring Return. Despite net exposure, estimated by A.M. Best, of GBP 106 million (USD 185 million) to the 2005 hurricanes, A.M. Best believes syndicate 623/2623's 2005 results are likely to compare favourably with its Lloyd's market peers. Future financial performance of syndicate 623/2623 is likely to continue to be supported by its strategy of expanding into areas where the rating environment remains relatively favourable.

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