Colonial Group International Ltd’s life/health and property/casualty operating subsidiaries have been affirmed the financial strength ratings of A- (excellent) and issuer credit ratings of “a-” by AM Best Co.The outlook for all ratings is stable. All companies are domiciled in Bermuda.The rating affirmations reflected the operating subsidiaries’ adequate risk-based capitalisation, the consistent increase in their total consolidated equity and diversified business profiles, with their focus being on life/health and property/casualty markets in Bermuda, the Bahamas, Cayman Islands and the Caribbean, said Best.Colonial Group’s life/health subsidiaries have reported favourable underwriting results in their most recent year with the exception of Colonial Life Assurance Company Ltd, which reported a small net profit in 2010. Although considerably improved compared to recent years, the company is likely to revert to reporting a net loss for the current year, said the ratings agency.Colonial Medical Insurance Company Ltd and Atlantic Medical Insurance Ltd (Bahamas) are regional companies with a continued strong presence in their respective health markets. Best said that on a net income and underwriting basis, the life/health subsidiaries’ combined results were higher in 2011 and 2010 from previous years, but top line growth remains a challenge, mostly due to a weak economic environment.Within the property/casualty operations, Colonial Group’s three operating subsidiaries, Colonial Insurance Company Ltd, British Caymanian Insurance Company Ltd (Cayman Islands) and Security and General Insurance Company Ltd (Bahamas), have generally demonstrated good underwriting results, improved operating performance trends and continuing parental support, said the ratings agency.Furthermore, Colonial Group benefited from these subsidiaries’ reinsurance leverage to manage their property/casualty risks, while growing direct premium revenues in their core markets, it concluded.Partially offsetting these rating strengths were Colonial Group’s significant concentration risk in the volatile health line of business in several geographic regions, vulnerability to frequency and severity of catastrophic events from the property/casualty risks within their markets and the large amounts of inter-company transactions, added Best.