A.M. Best Affirms Ratings of Transmonde Services Insurance Company, Limited

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of “a” of Transmonde Services Insurance Company, Limited (Transmonde) (Bermuda). The outlook for both ratings is stable.

The ratings reflect Transmonde’s historically strong operating performance, excellent risk-adjusted capitalization and history of consistently producing net underwriting income and net income in recent years. These factors have allowed Transmonde to enhance its surplus considerably in recent years.

Partially offsetting these positive rating factors are Transmonde’s relatively high retentions and concentration in liability lines with significant loss severity potential. An additional offsetting rating factor is its limited market profile as a single parent captive. Transmonde provides professional, general and pollution liability coverages to members of the International Association of Superintendents, which is a subsidiary of SGS SA (SGS) [SWX:SGSN], a publicly traded Swiss company.

Transmonde has maintained very conservative underwriting leverage ratios as surplus has consistently grown to support its business volumes. The company has posted low loss and loss adjustment expense ratios, reflecting SGS’ effective risk management. Transmonde’s relatively high per occurrence retentions are mitigated by significant deductibles and conservative reserving practices. The ratings recognize the company’s balance sheet strength and conservative underwriting leverage measures, as well as its role as the captive insurance company of SGS.

While A.M. Best believes Transmonde is well-positioned at its current rating level, factors that may lead to negative rating actions include unfavorable operating profitability trends, outsized investment losses and a significant decline in its risk-adjusted capital that would not be supportive of its current rating level.

A.M. Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

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 utilized:

• Risk Management and the Rating Process for Insurance Companies
• Understanding BCAR for Property/Casualty Insurers
• Understanding Universal BCAR
• Evaluating Country Risk
• Evaluating Non-Insurance Ultimate Parents
• Alternative Risk Transfer (ART)

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. Best
Marien Villegas, (908) 439-2200, ext. 5222
Financial Analyst
[email protected]
or
Christopher Sharkey, (908) 439-2200, ext. 5159
Manager, Public Relations
[email protected]
or
Steven Chirico, (908) 439-2200, ext. 5087
Assistant Vice President
[email protected]
or
Jim Peavy, (908) 439-2200, ext. 5644
Assistant Vice President, Public Relations
[email protected]

Source: A.M. Best

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