rating of A (Superior) to the Bermuda-based PartnerRe Group and its core affiliated insurance operations.

But the report said the agency was moderately concerned by the announced resignation of PartnerRe's president and CEO Herbert Haag, who it said turned what was a speciality property catastrophe reinsurer into an international, multi-line reinsurer.

The new rating represents an upgrade to the ratings of Partner Reinsurance Company of the U.S. and Partner Reinsurance Company of New York, both affiliates of the Partner Re Group. An A.M. Best statement said operations were "core and integral'' to the group's overall strategy and critical to its ongoing success and viability.

The PartnerRe Group's other affiliates include Partner Reinsurance Company Ltd. (Bermuda) and SAFR-PartnerRe of Paris. The group's equity of $1.9 billion and 1999 net premiums of $1.3 billion rank it among the top ten reinsurance companies in the world.

"Operating in an intensely competitive environment, PartnerRe has achieved generally strong operating returns through its highly focused client-oriented strategy, specialised underwriting expertise, diverse risk portfolio and strong operational discipline,'' said the statement.

"While maintaining a rigorous underwriting policy, the group continues to enhance its superior risk expertise in credit & surety, agricultural risks, aviation and catastrophe lines of business.'' A.M. Best also said the group maintained excellent capitalisation and conservative leverage measurers, supported by what it described as a sound investment strategy, disciplined reserving philosophy, prudent risk management and sophisticated reinsurance programmes.

But it said positive rating factors were partially offset by the 1999 earnings drop, due to the group's exposure to catastrophes.

"However the group's total return orientation seeks to maximise long-term earnings through retention of its net account exposures, subjecting it to a higher degree of year-over-year variability,'' A.M. Best said.

It also noted ParterRe had generated average returns on equity of 14.5 percent -- exceeding most of its peers -- and acquisitions had created risk diversification initiatives that are expected to improve earnings stability.