One of the nine new insurance companies to set up on the Island in the wake of the September 11 attacks has been given a top rating by ratings agency AM Best Co.

The US agency has assigned an initial financial strength rating of A minus (Excellent) to Endurance Specialty Insurance Ltd., Bermuda.

The company, which was formed in response to the market dislocation that has occurred in the global insurance and reinsurance markets after the US terrorist attacks, has been capitalised with $1.2 billion.

Financing was done through a private placement equity offering led by Aon, a leading risk management and insurance brokerage firm, and Zurich Financial Services, a leading worldwide insurance organisation.

AM Best said Endurance is looking to establish a "diversified global book of business which will include property, casualty, catastrophe, excess workers' compensation, aviation and space reinsurance, primary property, excess casualty and D&O insurance".

The ratings agency said: "The rating reflects Endurance's strong initial capital base, experienced management team and strong sponsorship."

Endurance is headed up by Kenneth J. LeStrange, chairman, president and chief executive officer, and Best said he: "brings extensive insurance industry experience and a demonstrated track record for producing strong results".

Best said that since it commenced operations in December 2001, Endurance has received, authorised and bound a significant amount of insurance and reinsurance business through a diverse group of brokers.

Best said it expects management to establish strong underwriting and risk management controls to ensure pricing discipline and controlled exposure aggregates.

But it added: "These strengths are offset by the challenges associated with a start-up company. Furthermore, new capital has rapidly entered the industry and could potentially dampen expected returns if pricing and terms fail to meet anticipated levels.

"A.M. Best will closely monitor Endurance's operations over the near-term to ensure rating expectations are achieved."

For more information, visit A.M. Best's Web site at www.ambest.com.