2013-10-25 16:40:03 -
A.M. Best Europe – Rating Services Limited has affirmed the financial strength rating of A++ (Superior) and the issuer credit rating of “aa+” of HSB Engineering Insurance Limited (HSBEIL) (United Kingdom). The outlook for both ratings remains stable.
The ratings of HSBEIL reflect its strong consolidated risk-adjusted capitalisation and strong specialist business profile in the UK and Canadian engineering sectors. The ratings also factor in HSBEIL’s strategic importance to its parent, The Hartford Steam Boiler Inspection and Insurance Company, a member of The Hartford Steam Boiler Group (HSB), as its principal source of geographical diversification. HSB benefits from the group’s synergies with Munich Reinsurance America, Inc. and its ultimate parent, Munich Reinsurance Company (Munich Re). Furthermore, HSB’s already robust enterprise risk
management (ERM) practices receive additional benefits from Munich Re’s extensive ERM resources.
HSBEIL’s risk-adjusted capitalisation improved in 2012, driven by a decline in underwriting risks and continuous earnings retention. The company has a robust track record of underwriting profitability, supported by its extensive engineering expertise. In 2012, HSBEIL reported a pre-tax profit of GBP 23 million and a combined ratio of 85%.
HSBEIL maintains a strong business position in the UK and Canadian markets as a specialist engineering insurer writing equipment property damage and business interruption insurance. The company benefits from its ownership of inspection and consultancy service provider, HSB Engineering Insurance Services Limited, which plays an active role in HSBEIL’s underwriting and claims management.
Positive rating actions could occur if there was upward rating movement at Munich Re. Negative rating actions could occur if risk-adjusted capitalisation was to decline significantly and consistently. Any material diversion from the company’s rating drivers could also trigger negative pressure on the company’s ratings.
The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M.
Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww ..
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Best Europe - Rating Services Limited Supplementary Disclosure : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww ..
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