AM Best has affirmed the ratings of Bermudian insurance group Argus.

The agency gave Argus Insurance and Bermuda Life Insurance Company a financial strength rating of B++.

“The ratings affirmations reflect the Argus Group’s consolidated positive earnings, the strengthening of its capital metrics and improvement of its asset quality,” stated AM Best.

The agency added that Argus underwriting and net income results had been driven mostly by strong positive earnings in the employee benefits segment.

It added: “In addition, the Argus Group has been transitioning its investment portfolio to higher quality lower risk assets.

“As a result, asset valuation writedowns have been minimal and the stabilisation of the investment portfolio has resulted in stronger investment income.”

However, AM Best said Argus had been hit by an earnings decline due to rising interest rates on the value of the fixed income portfolio.

The agency report said that the impact of hurricanes Fay and Gonzalo in 2014 had affected the year-end results.

“Additionally, although the Argus Group is gradually growing its European property/casualty operation, the geographic diversification of consolidated premium and earnings remains low,” stated AM Best.

The agency also retained the two group subsidiaries issuer credit ratings of bbb-, and affirmed Argus Group’s issuer credit rating at bb-.

The outlook for all the ratings is stable.