A.M. Best Removes Underwriters Reinsurance Group From Under Review.OLDWICK, N.J.--(BUSINESS WIRE)--Oct. 26, 1998--A.M. Best Co. has affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. and removed from under review the "A+" (Superior) rating of Underwriters 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. Group. The affirmation follows Underwriters Reinsurance Co.'s $190 million cash acquisition of Venton Holdings Ltd., a Bermuda-based holding company that conducts global insurance and reinsurance business with operations in London and Bermuda. With this transaction, Underwriters Re gains immediate access to Lloyd's global reinsurance market, which further broadens its intellectual capital resources, as well as diversifies the group's growth and earnings prospects outside 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. . These positive near-term implications are derived from Underwriters Re's new ownership in Venton 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. Ltd. (an underwriting corporate member of Lloyd's), Venton Underwriting Agencies Ltd. (a Lloyd's managing agency) and three Lloyd's syndicates in which Venton is a corporate member and managing agent. The rating also reflects the group's consistently strong operating results, solid capitalization and strong presence in the broker market. Over the years, Underwriters Re has been able to differentiate itself within the broker reinsurance market with proven underwriting expertise in its core working layer casualty business. The group targets non-traditional business sources by having the flexibility to shift its business mix to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. market opportunities, and by offering a broad array of products and services to its clients. Despite its more opportunistic opportunistic /op·por·tu·nis·tic/ (op?er-tldbomacn-is´tik) 1. denoting a microorganism which does not ordinarily cause disease but becomes pathogenic under certain circumstances. 2. approach, management also maintains a disciplined underwriting approach, as manifested by its underwriting results to date. Underwriters Re also benefits from the strength and financial flexibility of its parent, Alleghany Corp., whose capital contributions have supported the group's rapid premium growth. Underwriters Re's increased capital base has greatly enhanced its broker market acceptance, allowing it to offer larger participation and influence pricing and terms. These strengths are attenuated Attenuated Alive but weakened; an attenuated microorganism can no longer produce disease. Mentioned in: Tuberculin Skin Test attenuated having undergone a process of attenuation. by the group's rapid premium growth in recent years, continued debt servicing obligations, uncertainty related to asbestos and environmental liabilities and the dilutive impact resulting from the acquisition of Venton Holdings. In addition to intensified competition and pricing pressures in the reinsurance market, A.M. Best is concerned with Venton's aggressive near-term growth plans, which, combined with the use of short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. , could cause capitalization to fall below A.M. Best's standards for a superior-rated company. A.M. Best Co., established in 1899, is America's oldest and most widely recognized insurance rating and information source. For more information, visit A.M. Best's Web site at http://www.ambest.com. |
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