Moody's Investors Service said it assigned an 'A2' insurance financial strength (IFS) rating to Allied World Reinsurance, an indirect unit of property and casualty re/insurer Allied World Assurance Company Holdings Ltd. The outlook for the rating is stable.

Moody's said its rating on Allied World Reinsurance reflects its ownership by Allied World and the high degree of structural support and risk-sharing with, the lead Bermuda operating company through substantial quota share reinsurance agreements.

Allied World Reinsurance, formerly Converium Insurance North America Inc., was acquired from Berkshire Hathaway and will serve as the platform to expand the company's US reinsurance business. The rating also reflects common branding and management oversight by Allied World, Moody's added.

• Standard & Poor's (S&P) Ratings Services assigned its 'A-' counterparty credit and financial strength ratings to Allied World Reinsurance Co., a wholly owned unit of Bermuda-based Allied World Assurance Co Holdings Ltd. The outlook on Allied World Re is stable.

"The ratings assignment on Allied World Re reflects our view that this entity is a core member of the Allied World group of companies," said S&P's credit analyst Dennis Sugrue. 'We expect that Allied World Re will become Allied World's main vehicle in the US for the underwriting of US-based reinsurance risks."

• AM Best Co. has assigned a financial strength rating of A (excellent) and an issuer credit rating of 'a' to Allied World Reinsurance Co. (Allied World Re). The outlook assigned to both ratings is stable.

The ratings of Allied World Re receive enhancement based on the tangible support provided by its strategic affiliate, Allied World Assurance Co Ltd. (Bermuda), which includes a quota share agreement as well as renewing a substantial block of existing profitable casualty business from their Bermuda portfolio. In addition, the ratings reflect Allied World Re's ability to meet Best's stricter risk-based capital requirements for new company formations.

Partially offsetting these positive rating attributes is the execution risk associated with being a start-up company. This risk is slightly mitigated by the support of an established parent company; however, market acceptance needs to be built and retained, which will only be proven over time. In addition, softening market conditions and downward pricing pressures have been prevalent. Best will closely monitor Allied World Re against its stated business plan.