Ratings agency AM Best Co. yesterday affirmed the financial strength ratings of A+ (Superior) of IPCRe Group (IPCRe) and its affiliated companies.

Concurrently, Best has assigned issuer credit ratings of ?aa-? to IPCRe Limited (Bermuda) and IPCRe Europe Limited (Ireland). All ratings have a stable outlook.

The ratings were said to reflect IPCRe?s superior risk-adjusted capitalisation, excellent historical earnings and well established market presence within the global property catastrophe reinsurance market. The ratings also acknowledged IPCRe?s highly experienced management team, prudent risk management strategies and customer-oriented focus.

Due to management?s strong capabilities, the company was said to have withstood volatility in operating performance over time, stemming from high severity catastrophic activity from 1998 through 2001 and through the extraordinary hurricane activity during the third quarter of 2004.

The ratings also considered the advantages IPCRe derives through strategic relationships with affiliates of its original sponsor and largest shareholder, American International Group Inc.

AIG affiliates provide administrative and back-office functions in addition to investment portfolio management services.

Partially offsetting IPC?s positive rating factors were the increasing availability of reinsurance capacity in the property catastrophe reinsurance market and IPCRe?s focused risk profile, which may pressure future operating performance.

These concerns are mitigated by IPCRe?s unencumbered balance sheet supported by an investment portfolio with over $1.8 billion of invested assets that are conservatively managed to ensure adequate liquidity and preservation of capital.

Furthermore, IPCRe consistently records strong operating cash flows, which are supplemented by the availability of a $200 million revolving credit facility and enhances financial flexibility.