A.M. Best Co. Assigns Rating to Da Vinci Re.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Nov. 15, 2001 A.M. Best Co. has assigned an A (Excellent) financial strength rating to Da Vinci da Vinci Surgery A surgical robot for performing certain surgeries–eg, mitral valve repair and laparoscopic procedures–eg, cholecystectomy and gastric ulcer repair. See Laparoscopic surgery, Robotics, Surgical robot. 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. Ltd., Bermuda, a strategic joint venture formed by Renaissance Reinsurance Ltd. and State Farm Mutual Insurance Company to write various property/catastrophe coverages on a worldwide basis. The rating reflects the company's strong capitalization with investments by State Farm and Renaissance Re, augmented by bridge funding to provide an initial capital base of $500 million. Bridge funding is expected to be replaced over the near term by capital raising initiatives with both strategic and financial investors. Da Vinci Re also benefits from Renaissance Re's sponsorship and management, which provides it access to a proven business model as demonstrated by the superior results achieved by Renaissance Re and its prior joint venture relationships. A.M. Best expects the company to maintain a conservative financial leverage position with future debt to capital not to exceed 25%. Da Vinci Re was formed to provide fresh capacity to the property catastrophe reinsurance market in the wake of the September 11 terrorist attacks. It will provide companion line capacity for business underwritten by Renaissance Re, a recognized leader in the property catastrophe reinsurance market. Under Renaissance Re's management, Da Vinci Re will be subject to the same highly disciplined 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. approach and will be supported by its proprietary REMS REMS Sleep disorders Rapid eye movements. See REM sleep. catastrophe modeling
As policy terms tighten and clients become more concerned about security, strength and stability, Da Vinci Re will be well positioned to take advantage of the flight to quality and subsequent price increases. Da Vinci Re's strengths are partially offset by the potential for increased market competition in property/catastrophe coverage from other new companies as additional capacity is currently entering the market to take advantage of short-term price hardening hardening, in metallurgy, treatment of metals to increase their resistance to penetration. A metal is harder when it has small grains, which result when the metal is cooled rapidly. . The additional capacity is expected to add pricing competition in the long-term, adding potential pressure to future operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: . 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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