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AM Best revises Argus outlook

Ratings agency AM Best has revised its outlook for Argus Group from negative to stable.

“We are pleased that AM Best has recognised the success of our two main operating units and holding company by revising the outlook to stable,” said Alison Hill, CEO of the Argus Group.

“We are delighted that AM Best has taken into account our return to profitability, the strengthening of the company’s capital and the improvement of our asset quality. Furthermore, we are happy that AM Best has recognised our underwriting strength and net income results that turned positive in 2012 and continue to remain favourable.”

Last March AM Best affirmed Argus’s B++ financial strength rating with a negative outlook.

AM Best said in a statement the stable outlook reflects Argus’s return to profitability, the strengthening of its capital and improvement of its asset quality.

“The improved results are mainly due to the lack of asset valuation write-downs and a higher level of investment income,” the agency said.

“For a three-year period through year ending March 31, 2011, although the company reported net losses, underwriting results remained positive. Argus Group has been transitioning its investment portfolio to higher quality lower risk assets. As a result, asset valuation write-downs have been minimal and the stabilization of the investment portfolio has resulted in improved investment income. Additionally, the transition of the investment portfolio also is achieving a better asset/liability matching. The positive net income has allowed the organization to strengthen its capital level through retained earnings.”

The agency added: “The earnings results for Argus Group’s insurance operations continue to be positive, and premiums and fee-based income have shown a good level of growth. On a combined basis, Bermuda Life and the former Somers Isles (the organization’s domestic life, annuity, pension and health insurance subsidiary), reported premium growth and improved net income results, which were driven primarily by an improved loss ratio for its health business and improved results from its invested assets.”

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Published June 07, 2013 at 9:00 am (Updated June 06, 2013 at 7:36 pm)

AM Best revises Argus outlook

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