A.M. Best Affirms Ratings of Lloyd's Syndicate 1414.

OLDWICK, N.J. -- A.M. Best Co. has affirmed the Best's Syndicate Rating of A+ (Superior) and the issuer credit rating (ICR) of "aa-" of Lloyd's Syndicate 1414 (United Kingdom), which is managed by Ascot Underwriting Limited (AUL). The outlook for both ratings remains stable.

The ratings assigned to syndicate 1414 are underpinned by the strength of the Lloyd's market. In addition, the ratings reflect the explicit support of American Home Assurance Company, a member of the American International Group (AIG). The syndicate's capacity is likely to increase to approximately GBP 625 million (USD 1170 million) in 2007, up from GBP 550 million (USD 1030 million) in 2006, due to projected growth in premium income from its property, excess of loss, cargo and energy lines.

The ratings also reflect good expected operating performance in the open years 2004 to 2006. The period includes an anticipated loss somewhat above A.M. Best's previous expectations for 2005 of approximately 10% of capacity (in line with the syndicate's June 2006 midpoint forecast), as well as a strong recovery in 2006 when A.M. Best believes a profit in excess of 22.5% of capacity is likely. The anticipated loss in 2005 is driven by the syndicate's significant property, excess of loss and energy accounts, which have given rise to a net loss from the U.S. hurricanes of approximately GBP 125 million (USD 215 million). On an annually accounted basis, the syndicate reported a GBP 91.7 million loss (USD 157.6 million) for 2005 (compared to a GBP 126 million profit (USD 241.4 million) in 2004).

In A.M. Best's opinion, the syndicate has a well diversified portfolio. It specializes in a range of business classes including property, excess of loss, marine hull, energy, cargo, aviation war, specie, fine art, terrorism and political risk. In 2005, the syndicate led approximately 40% of business by gross premiums written.

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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.