A.M. Best Upgrades Ratings of Peleus Reinsurance Ltd.OLDWICK, N.J. -- A.M. Best Co. has upgraded the financial strength rating to A (Excellent) from A- (Excellent) and issuer credit rating (ICR (Intelligent Character Recognition or Image Character Recognition) The machine recognition of hand-printed characters as well as machine printing that is difficult to recognize. ) to "a" from "a-" of Peleus 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. (Peleus) (Hamilton, Bermuda). The outlook on both ratings for the Bermuda Class 4 reinsurer re·in·sure tr.v. re·in·sured, re·in·sur·ing, re·in·sures To insure again, especially by transferring all or part of the risk in a contract to a new contract with another insurance company. is stable. Peleus is a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Argo Group International Holdings, Ltd. (Argo Group) [NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AGII]. The FSR (Free System Resource) In Windows 3.x, the amount of unused memory in various 64K blocks reserved for managing current applications. Every open window takes some space in this area. See Windows memory limitation. of A (Excellent) and the ICRs of "a" are unchanged for the other Argo Group subsidiaries. The rating upgrades are based on today's announced restructuring of the Argo Group organizational platform, the pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma surplus for Peleus of approximately $1.3 billion and the benefits derived from the overall consolidated operating results and financial strength of Argo Group and its subsidiaries. The rating upgrades also consider Peleus' experienced management team, prudent business plan and the expectation that all existing liabilities assumed from its announced amalgamation (merger) with PXRE Reinsurance Ltd. (PXRE) (Hamilton, Bermuda) will be run off in an orderly fashion. An analysis of current and pro-forma cash flows indicates that sufficient capital exists to support existing financial obligations. Due to this merger, A.M. Best has withdrawn the FSR of B+ (Good) and ICR of "bbb-" of PXRE. These positive rating factors are partially offset by the potential for additional adverse loss reserve development, although prior year loss reserves have been stable during calendar years 2006 and 2007. In addition to being susceptible to high severity events, A.M. Best anticipates that Peleus will be challenged by increased competition from both established companies and start-ups seeking to gain market share. Furthermore, the ability of Peleus to effectively build and retain market acceptance must be proven over time. Accordingly, A.M. Best will closely monitor the quarterly performance of Peleus against its stated business plan, and any material negative deviation in terms of earnings, capitalization or risk profile could result in downward pressure on the ratings. Formed in 2007, Peleus provides quota share reinsurance to Argo Group's U.S. subsidiaries and also provides specialized coverage on a worldwide basis, focusing on property catastrophe, risk excess and pro rata [Latin, Proportionately.] A phrase that describes a division made according to a certain rate, percentage, or share. In a Bankruptcy case, when the debtor is insolvent, creditors generally agree to accept a pro rata share of what is owed to them. coverages through the broker market. The vast majority of Peleus' business is generated by its property/casualty subsidiaries via the quota share. For Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com. |
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