OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” of Allied World Assurance Company Holdings, Ltd’s (Bermuda) (Allied World Holdings) operating affiliates (collectively referred to as Allied World or the group). Concurrently, AM Best has affirmed the Long-Term ICR of “bbb” of Allied World Assurance Company Holdings, Ltd (Bermuda) and its downstream holding company, Allied World Assurance Company Holdings I, Ltd. (Bermuda). AM Best also has affirmed the Long-Term Issue Credit Rating (Long-Term IR) of “bbb” of the $500 million 4.35% senior unsecured notes of Allied World Assurance Company Holdings I, Ltd. due 2025, which are unconditionally and irrevocably guaranteed by Allied World Holdings. The outlook of all of these Credit Ratings (ratings) remains stable.
The ratings reflect Allied World’s balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
The group's operating performance has been variable over the past five years due to catastrophe events and variability in both reserve development and net investment gains. The group's underwriting performance is in line with its peers and is benefiting from recently improved market conditions in most of its business segments as well as the lower catastrophe losses of the past two years. The group generates a low investment yield relative to its peers due to its investment strategy, which includes both lower-risk, short-term bonds, and equities that are managed for long-term accretion to capital.
The group’s risk-adjusted capital is supportive of its current loss reserve position, which has shown some variability in recent accident years; premium growth; investment risk and catastrophe loss exposure. Liquidity measures are sound and supported by relatively short-term holdings, predominantly high quality fixed-income securities and cash.
Additionally, Allied World benefits from being part of Fairfax Financial Holdings Limited’s diversified business platform, decentralized yet collaborative business practices, and fungible and strong capital position.
The group maintains a neutral business profile. The group is a specialty insurance and reinsurance entity that underwrites a diversified portfolio of property and casualty business. The group is well-diversified geographically with a global market presence. Growth in the group’s business benefitted in 2019 from improving market conditions and increased rates.
Allied World maintains a comprehensive risk management program, which is viewed as appropriate for the complexity of its operations.
The FSR of A (Excellent) and the Long-Term ICR of “a” have been affirmed with a stable outlook for the following operating subsidiaries of Allied World Assurance Company Holdings, Ltd:
- Vantapro Specialty Insurance Company
- Allied World Assurance Company, Ltd
- Allied World Surplus Lines Insurance Company
- Allied World Assurance Company (U.S.) Inc.
- Allied World National Assurance Company
- Allied World Specialty Insurance Company
- Allied World Insurance Company
- Allied World Assurance Company (Europe) Designated Activity Company
- Vault E&S Insurance Company
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