A.M. Best Affirms Ratings of Ironshore Insurance Ltd. and Ironshore Reinsurance Ltd.; Assigns Ratings to U.S. Subsidiaries
Business Wire
A.M. Best Co. has affirmed the financial strength rating (FSR) of A- (Excellent) and issuer credit ratings (ICR) of ‘a-‘ of Ironshore Insurance Ltd. (Ironshore) and Ironshore Reinsurance Ltd (both of Bermuda).
Concurrently, A.M. Best has affirmed the ICR of ‘bbb-‘ of Ironshore’s holding company, Ironshore Inc. (Cayman Islands). The outlook for these ratings is stable.
A.M. Best also has assigned an FSR of A- (Excellent) and ICRs of ‘a-‘ to Ironshore Indemnity Inc. (III) (Minneapolis, MN) and Ironshore Specialty Insurance Company (ISIC) (Phoenix, AZ). The outlook assigned to these ratings is stable.
The rating affirmations are based on Ironshore’s solid operating results and excellent capitalization during its first year of operations. Management continues to enhance infrastructure along with systems and controls to accommodate current and future growth. During its first year, Ironshore focused on property coverage and expanded into professional liability lines as included in its original plan. The company, however, was challenged by less than anticipated premium volume due to the current soft market along with some unexpected losses in segments of its investment portfolio. Furthermore, Ironshore is still establishing a formal enterprise risk management framework that will address all aspects of its risk exposures. A.M. Best will closely monitor Ironshore’s progress in this phase of its development.
The ratings of the two new U.S. affiliates, III and ISIC, reflect their expected solid capitalization, reasonable business plan and experienced management teams. III will provide Ironshore with a U.S. presence in the D&O, E&O and professional indemnity markets, while ISIC was established as an excess and surplus lines writer focusing on contractor, artisan, hospital and long-term care professional liability through its IronBuilt and IronHealth business segments.
In addition to being susceptible to low frequency high severity events, A.M. Best anticipates that Ironshore will continue to be challenged by increased competition from both established companies and start-ups seeking market opportunities. Furthermore, the ability of Ironshore to effectively build and retain market acceptance will only be proven over time. Accordingly, A.M. Best will continue to closely monitor the quarterly performance of Ironshore against its stated business plan, and any material negative deviations in terms of management, earnings, capitalization or risk profile could result in downward pressure on the ratings.Â
For Best’s Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.
