Lancashire rating affirmed by AM Best
AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Ratings of a+ (Excellent) of Lancashire Insurance Company Limited (Hamilton, Bermuda) and Lancashire Insurance Company (UK) Limited — collectively referred to as Lancashire.
Additionally, AM Best has affirmed the Long-Term ICR of bbb+ (Good) of the parent company, Lancashire Holdings Limited, of Hamilton, Bermuda. The outlook of these Credit Ratings is stable.
The ratings reflect Lancashire’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.
Lancashire maintains the strongest levels of risk-adjusted capitalisation as measured by Best’s Capital Adequacy Ratio.
In addition to the strongest level of risk-adjusted capitalisation, the assessment of balance sheet strength is supported by the group’s financial flexibility and history of prudent reserving.
The group actively manages its capital and raised capital last year to take advantage of favourable market opportunities.
Also reflected in the ratings is Lancashire’s historically strong overall performance, driven by underwriting results in non-catastrophe-affected years and complemented by investment income and fee income.
Lancashire maintains an elevated risk profile as it writes lines of business that have significant exposures to catastrophe activity. Lancashire is a specialty underwriter with a good degree of geographic and product-line diversification as the company’s offerings include primary insurance, reinsurance and retrocessional coverages written on a global basis through traditional capacity, Lloyd’s and its Kinesis platform.
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