A.M. Best Affirms Ratings of Lloyd’s Syndicate 1225

LONDON--(BUSINESS WIRE)-- A.M. Best has affirmed the financial strength rating (FSR) of A (Excellent) and the issuer credit rating (ICR) of “a+” of Lloyd’s Syndicate 1225 (United Kingdom), which is managed by AEGIS Managing Agency Limited. The outlook for both ratings is positive.

The ratings of Syndicate 1225 reflect the financial strength of the Lloyd’s market, which underpins the security of all Lloyd’s syndicates. In addition, the syndicate benefits from its association with Associated Electric & Gas Insurance Services Limited (AEGIS), which is the ultimate parent of its main capital provider, AEGIS Electric & Gas International Services Limited.

The syndicate has a record of good operating performance in recent years, as demonstrated by a five-year average combined ratio of 87%. In 2014, the syndicate achieved a very strong result, reporting a profit before tax of GBP 60.5 million and a combined ratio of 85%, reflecting good catastrophe claims experience, prior year reserve releases and an improved result from outwards reinsurance. In a benign year for claims, the largest loss arose from aircraft attacked by militia at Tripoli airport in Libya. For 2015, pricing weakness and more normal catastrophe and large loss experience would, in principle, lead to a combined ratio percentage in the mid 90s.

The syndicate writes a well-diversified portfolio comprising both property and casualty business. Diversification has improved significantly in recent years, due to a combination of growth in new classes and a reduction in energy and utility lines, which previously dominated the book. Syndicate 1225 maintains a good business profile and considerable expertise in energy and utility insurance despite this reduction, supported by its association with AEGIS, which is a Bermuda-based mutual serving U.S. utility and energy companies.

Partly offsetting these strengths is the potential for earnings volatility due to exposure to catastrophe losses and the effect of exchange rate movements on the expense ratio.

A factor that may lead to positive or negative rating actions for the syndicate is a change in the ratings of Lloyd’s, which currently has an FSR of A (Excellent) and an ICR of “a+” with a positive outlook.

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 Lloyd’s Syndicates
• Rating Members of Insurance Groups
• Risk Management and the Rating Process for Insurance Companies

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.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150611005719/en/

A.M. Best Co.
Anthony Silverman
Senior Financial Analyst
+(44) 20 7397 0264
[email protected]
or
Catherine Thomas
Director, Analytics
+(44) 20 7397 0281
[email protected]
or
Christopher Sharkey
Manager, Public Relations
+(1) 908 439 2200, ext. 5159
[email protected]
or
Jim Peavy
Assistant Vice President, Public Relations
+(1) 908 439 2200, ext. 5644
[email protected]

Source: A.M. Best Co.

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