A.M. Best Affirms the Ratings of AIG Europe Limited
February 27 2015 - 12:12PM
Business Wire
A.M. Best has affirmed the financial strength rating of A
(Excellent) and the issuer credit rating of “a” of AIG Europe
Limited (AEL) (United Kingdom). The outlook for both ratings is
stable. AEL is a wholly owned subsidiary of American
International Group, Inc. (AIG) (New York, NY) [NYSE:AIG].
The ratings of AEL reflect its strong risk-adjusted
capitalisation, excellent operating performance and a strong
business profile that is supported by excellent distribution
capabilities across Europe.
In 2012, AIG completed the restructuring of its European
operations, to create a branch network across 26 European
countries, with AEL as a U.K. domiciled insurance company at the
centre. Key benefits of the restructuring include a simpler and
more transparent operating structure, increased capital
fungibility, particularly in the context of the pending
implementation of Solvency II, operational efficiencies and
alignment with the pan-European management structure.
In 2013, the first full year of operation of AEL as the single
European company, an excellent operating profit before tax of GBP
558 million was reported, including an underwriting result of GBP
296 million and net investment income of GBP 256 million, which
represented a good investment return of 2.8%. For 2014, a strong
operating performance is again anticipated, underpinned by a solid
underwriting profit.
AEL has a good business profile in the commercial insurance
market, with a particularly strong competitive position in the
aerospace, marine, energy and financial lines markets. In addition,
the company is a significant writer of multinational programmes.
Its competitive position is enhanced by excellent distribution
capabilities and the ability to offer a broad range of products
across a wide geographic area.
Factors that may lead to negative rating actions include a
decline in risk-adjusted capitalisation, weaker-than-expected
operating performance or deterioration in reserves. Factors
affecting other subsidiaries within the wider AIG group could place
upward or downward pressure on AEL’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.
Key insurance criteria reports utilised:
• Catastrophe Analysis in A.M. Best Ratings
• Rating Members of Insurance Groups
• Risk Management and the Rating Process for Insurance
Companies
• Understanding Universal BCAR.
In accordance with Regulation (EC) No. 1060/2009, the
following is a link to required disclosures: A.M. Best Europe -
Rating Services Limited Supplementary Disclosure.
This press release relates to rating(s) that have been
published on A.M. Best's website. For all rating information
relating to the release and pertinent disclosures, including
details of the office responsible for issuing each of the
individual ratings referenced in this release, please visit A.M.
Best’s Ratings & Criteria Center.
A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2015 by A.M. Best Company,
Inc. ALL RIGHTS RESERVED.
A.M. BestDavid DrummondSenior Financial
Analyst+(44) 20 7397
0327david.drummond@ambest.comorCatherine
ThomasDirector, Analytics+(44) 20 7397
0281catherine.thomas@ambest.comorChristopher
SharkeyManager, Public Relations+(1) 908 439 2200,
ext. 5159christopher.sharkey@ambest.comorJim
PeavyAssistant Vice President, Public Relations+(1)
908 439 2200, ext. 5644james.peavy@ambest.com
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