Fitch Assigns 'A' IFS Rating to OneBeacon Subsidiary

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has assigned an 'A' Insurer Financial Strength (IFS) Rating to OBI America Insurance Company (OBIA), an indirect wholly owned subsidiary of OneBeacon Insurance Group, Ltd. (NYSE: OB) (OneBeacon). The Rating Outlook is Stable. A full list of ratings follows at the end of this release.

KEY RATING DRIVERS

Fitch views OBIA as 'core' to its parent, OneBeacon, as defined in the agency's Insurance Rating Methodology. As such Fitch has taken a group approach and set the rating of OBIA at the same level as the other OneBeacon group members.

OBIA shares common management, branding, back-office functions, and other systems with other OneBeacon group members. Additionally, OBIA is part of a quota share reinsurance agreement within OneBeacon. In totality, Fitch believes that capital is fungible amongst group members.

Fitch's last rating action on OneBeacon was on March 29, 2016. Fitch affirmed the ratings and revised the Rating Outlook to Stable from Negative.

RATING SENSITIVITIES

Key rating triggers that could lead to a downgrade of OneBeacon's ratings are:

--Adverse loss reserve development of 5% or greater of prior year equity;

--Sustained GAAP calendar year combined ratios over 100% or sustained fixed charge coverage below 5.0x;

--Financial leverage above 30%.

Key rating triggers that could lead to an upgrade of OneBeacon's ratings are:

--Improvement in competitive market position while continuing to produce favorable operating results while not sustaining deterioration in other credit factors.

FULL LIST OF RATING ACTIONS

Fitch has assigned the following rating with a Stable Outlook:

OBI America Insurance Company

--IFS at 'A'.

Fitch took no rating action on the following ratings:

OneBeacon U.S. Holdings, Inc.

--IDR 'BBB+';

--$275 million 4.6% due Nov. 9, 2022 'BBB'.

OneBeacon U.S. insurance subsidiaries:

Atlantic Specialty Insurance Company

Homeland Insurance Company of New York

Homeland Insurance Company of Delaware

OBI National Insurance Company

--IFS 'A'.

Additional information is available on www.fitchratings.com.

Applicable Criteria

Insurance Rating Methodology (pub. 17 May 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=881564

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1010350

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1010350

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160812005732/en/

Fitch Ratings
Primary Analyst
Gerald B. Glombicki, CPA
Director
+1-312-606-2354
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
Secondary Analyst
Brian C. Schneider, CPA, CPCU, ARe
Senior Director
+1-312-606-2321
or
Committee Chairperson
Donald F. Thorpe, CFA, CPA
Senior Director
+1-312-606-2353
or
Media Relations:
Hannah James, + 1-646-582-4947
[email protected]

Source: Fitch Ratings

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