A.M. Best Affirms SCOR Group A+ -Superior- Rating.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--May 23, 2000 A.M. Best Co. has affirmed the A+ (Superior) financial strength rating of SCOR SCOR Scientific Committee on Oceanic Research SCOR Supply Chain Operations Reference model SCOR Small Corporate Offering Registration SCOR Specialized Center of Research (White Plains, NY) SCOR Second Cousin Once Removed Group, Paris. The rating applies to SCOR Group, its 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. subsidiaries and their insurance subsidiaries based on the consolidation of these companies. The companies are integral to the overall strategy and success of the SCOR Group and are contributors to its market position, operating performance and financial strength. The group rating recognizes the unconditional guarantee from the parent for all reinsurance and insurance business that is written by the rated subsidiaries that receive capital support from the parent and operate as a single reinsurance unit backed by the full 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. capacity and financial and technical resources of the group. In addition, the group rating reflects the centrally established underwriting guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. for SCOR's subsidiaries to ensure the diversification and management of risk with respect to its business by line and class of business. Headquarter head·quar·ter v. head·quar·tered, head·quar·ter·ing, head·quar·ters Usage Problem v.tr. To provide with headquarters: operations in Paris provide claims, accounting, legal, administrative, systems, internal audit, investment and human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. support to the group subsidiaries outside of France. A.M. Best believes SCOR has the size and financial strength to compete effectively in the global reinsurance market. The group has maintained a competitive advantage in the reinsurance of large industrial risks while, at the same time, building profitable business volumes in life, accident and health reinsurance and non-traditional reinsurance. Total premium in life, accident and health reinsurance increased 62% over 1998; at the same time, contributions to earnings rose 58%. The solid performance of non-traditional reinsurance was mainly attributable to excellent results from SCOR subsidiary, Commercial Risk Partners and from the expansion of new markets for credit risks reinsurance. The rating also reflects SCOR's ability to combine its financial capacity with its underwriting and marketing competencies while maintaining strong ties with ceding cede tr.v. ced·ed, ced·ing, cedes 1. To surrender possession of, especially by treaty. See Synonyms at relinquish. 2. companies. SCOR is able to provide complex solutions demanding expertise in specialty classes such as exceptional risks, unbalanced risks and unstructured risks in property/casualty and sub-standard risks in life as well as program business in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Some of the largest industrial groups in the world contact SCOR for their insurance, risk-management and loss prevention needs given SCOR's underwriting expertise of high value commercial structures. The rating also considers SCOR's growing number of lead positions in its transactions where it can determine terms and conditions, as well as its global spread of business. Despite falling below A.M. Best's expectations for operating performance in 1999, SCOR's results were similar to others in the reinsurance sector that also experienced exceptional losses from weather-related catastrophes. These catastrophes weighed heavily on SCOR's earnings, but the effect was cushioned through prudent risk selection. Deteriorating rates and worsening wors·en tr. & intr.v. wors·ened, wors·en·ing, wors·ens To make or become worse. Noun 1. worsening - process of changing to an inferior state decline in quality, deterioration, declension contract terms also contributed to the group's decline in earnings. These strengths are offset by a competitive reinsurance market and the under-performance of the group's property/casualty division. Natural catastrophes negatively impacted the group's 1999 consolidated results by EURO 182 million; the property/casualty division's combined ratio increased 10 points to 119. In addition, the equalization reserve Equalization Reserve A long-term reserve that an insurance company keeps for the purpose of preventing cash-flow depletion in the event of a significant unforeseen catastrophe. was reduced by EURO 30 million in an effort to counter the catastrophe losses. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses decreased sharply. The 1999 return on equity was reduced to 8% from 12% the previous year. For the second consecutive year, the performance of the group's U.S. operation--SCOR Reinsurance Co.--failed to meet group expectations. The disappointing performance was due in part to an $18 million loss from Hurricane Floyd This article is about the 1999 hurricane. For other storms of the same name, see Tropical Storm Floyd (disambiguation). Hurricane Floyd was the sixth named storm, fourth hurricane, and third major hurricane in the 1999 Atlantic hurricane season. and a return on equity of less than 4%. A.M. Best expects the group to return to historical performance standards in 2000, including stronger capitalization and improved profitability. The members of SCOR Group whose ratings are affirmed at A+ are: - SCOR; - SCOR Italia; - SCOR Deutschland; - SCOR UK; - SCOR Canada; - SCOR Asia-Pacific (including SCOR Asia-Pacific Australian branch, SCOR Re Far East and SCOR Reinsurance Company Asia); - SCOR Reinsurance Co., United States (including General Security subsidiaries); - Commercial Risk Partners, Bermuda (including Commercial Risk Reinsurance Company Ltd., Commercial Risk Re-Insurance Co. and Commercial Risk Luxembourg). 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. |
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