2010-01-18 20:22:02 -

A.M. Best Co. has affirmed the financial strength rating of A (Excellent) and issuer credit rating of “a+” of Aioi Insurance Company, Limited (Aioi) (Japan). The outlook for both ratings is stable.

The ratings reflect Aioi’s sound risk-adjusted capitalization and consistent underwriting performance.

Aioi’s proactive reduction of risky assets mitigated the downside risk of its risk-adjusted capitalization. As a result, although Aioi’s risk-adjusted capitalization has deteriorated, as measured by both the local solvency margin ratio and Best’s Capital Adequacy Ratio (BCAR), the company has maintained a sufficient level of risk-adjusted capitalization over the past two years to support the current ratings.
Aioi’s local solvency margin ratio stood at 815% as at the end of June 2009.

Although the negative growth in the

Japanese non-life insurance market and unfavorable trends in loss claims have negatively affected Aioi’s underwriting performance, it has posted a stable combined ratio of below 100% over the past four years. A.M. Best expects that Aioi can maintain underwriting performance in fiscal year 2009, as it continues to focus on its core competitiveness such as its strong business relationship with Toyota Motor Corporation and strong sales channels in the housing industry.

Partially offsetting these positive rating factors are the sluggish economy and stagnant market situation in Japan, which will limit the growth of Aioi’s core business lines such as motor and fire.

A.M. Best also has affirmed the financial strength rating of A (Excellent) and issuer credit rating of “a+” of Aioi Insurance Company of America (New York, NY). The outlook for these ratings is stable.

For Best’s Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings : .

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology : .



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 : .


A.M. Best Co.AnalystsAustin Sanghoon Oh,

+852-2827-3404 sang.oh@ambest.com : mailto:sang.oh@ambest.com orMoungmo
Lee, +852-2827-3402 moungmo.lee@ambest.com : mailto:moungmo.lee@ambest.com orPublic
RelationsJim Peavy, +(1) 908-439-2200, ext. 5644 james.peavy@ambest.com : mailto:james.peavy@ambest.com orRachelle
Morrow, +(1) 908-439-2200, ext. 5378 rachelle.morrow@ambest.com : mailto:rachelle.morrow@ambest.com