US insurer Darwin — a recent acquisition of Bermuda-based Allied World Assurance Company — has had its financial strength rating (FSR) upgraded by AM Best to A from A-.

Best also affirmed Allied World's financial strength rating at A.

"Darwin's book of business allows Allied World greater access to small and mid-size accounts in the US health care and professional liability sector, and it is complementary to Allied World's casualty focused strategy," Best said in its commentary on the ratings actions.

"The ratings of Darwin receive enhancement, in part, based on a substantial quota share agreement between Darwin National Assurance Company (DNA) and Allied World."

In Best's view, Allied World's ratings reflect "its strong risk-adjusted capital position, stable management team and solid operating performance".

The agency also noted that Allied was enhancing its risk management controls with features such as formal crisis management plans and a catastrophe committee.

"Partially offsetting these positive ratings factors is the current soft pricing environment in addition to the turbulence in the financial markets, which has been impacting many insurance and reinsurance companies' investment portfolios and access to capital," Best added.