A.M. Best Upgrades Ratings of National General Insurance Company (P.S.C.)

LONDON--(BUSINESS WIRE)-- A.M. Best has upgraded the financial strength rating to A- (Excellent) from B++ (Good) and the issuer credit rating to “a-” from “bbb+” of National General Insurance Company (P.S.C.) (NGI) (United Arab Emirates). The outlook for both ratings has been revised to stable from positive.

The upgrade reflects NGI’s consistently strong technical performance, very strong risk-adjusted capitalisation and improved enterprise risk management (ERM).

NGI has consistently reported strong technical results over the past five years. The company’s non-life operation has generated an excellent five-year average combined ratio of 90.8% (2010 to 2014). NGI’s life portfolio has also reported good profits in each of the past five years. Robust underwriting performance has been maintained despite prevailing competitive market conditions in the company’s domestic market of the United Arab Emirates, with significant pressure on premium rates across most lines of business. NGI’s prudent approach to risk selection and focus on profitability over top-line growth is expected to support future technical performance.

NGI’s risk-adjusted capitalisation improved to a very strong level during 2014. The strengthening largely reflects a 10.6% increase in capital and surplus and the company’s divesture of a significant portion of its equity holdings during the year. Prospective risk-adjusted capitalisation is expected to be supported by further de-risking and diversification of the company’s investment portfolio. NGI’s capital position is anticipated to remain sufficiently strong to support the company’s growth targets for the next three years.

NGI’s approach to ERM improved notably during 2014. The company has strengthened its identification and understanding of key risks and imposed controls in order to mitigate and reduce their potential impact. NGI’s internal capital model has enabled enhanced quantification of the effect of future strategic initiatives on risk-adjusted capitalisation.

Further positive rating actions are unlikely at present. Negative rating pressure may arise if the company were to experience a significant and prolonged deterioration in technical performance.

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
• Evaluating Country Risk
• 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. Best
Myles Gould, +(44) 20 7397 0267
Financial Analyst
[email protected]
or
Mahesh Mistry, +(44) 20 7397 0325
Director, Analytics
[email protected]
or
Christopher Sharkey, +(1) 908-439-2200, ext. 5159
Manager, Public Relations
[email protected]
or
Jim Peavy, +(1) 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
[email protected]

Source: A.M. Best

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