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

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.

The syndicates benefit from the financial strength of the Lloyd's market, which underpins the security of all Lloyd's syndicates. The syndicate ratings are based on A.M. Best's specific syndicate criteria. (See A.M. Best's Rating Methodology for Lloyd's Syndicates at http://europe.ambest.com/lloydsmethodology.pdf).

The two syndicates underwrite business at Lloyd's in parallel with premium income split in line with total capacity--GBP 220 million (USD 422.4 million) and GBP 522 million (USD 1 billion) for syndicates 623 and 2623, 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.

The financial performance of the combined syndicate is likely to continue to be supported by its strategy of expanding into areas where conditions remain favourable, such as larger risk professional liability. A.M. Best forecasts solid profits (after personal expenses) for syndicate 623 of between 10%-15% of capacity for the 2002 and 2003 years of account, respectively, which is in line with the syndicate's latest forecasts (Lloyd's Quarterly Monitoring Return at September 2004). Syndicate 623 and 2623 report identical underwriting results from 2003 onwards based on their share of combined allocated capacity (which is approximately 46% and 54%, respectively, in 2004 and 30% and 70% in 2005). Despite moderate exposure to the series of catastrophes in the second half of the year, A.M. Best believes syndicate 623/2623 is likely to remain profitable in 2004, although below the level forecast for 2002 and 2003.

The combined syndicate has an excellent profile as an underwriter of a wide variety of specialist liability and property lines, leading more than 50% of business written (by premium volume). Business is written in four main divisions (specialty lines, property, marine and reinsurance), providing the syndicate with a well diversified account both in terms of classes of business and territories written. A.M. Best believes the recent formation of a new U.S.-based managing agent, Beazley USA Services Inc. (BUSI), will provide the syndicate with access to additional U.S. surplus lines business that it may otherwise not have seen through its existing distribution channels.

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