A.M. Best Affirms Ratings of ARABIA Insurance Company - Jordan

LONDON--(BUSINESS WIRE)-- A.M. Best has affirmed the financial strength rating of B+ (Good) and issuer credit rating of “bbb-” of ARABIA Insurance Company - Jordan (AIC-J) (Jordan). The outlook for both ratings remains stable.

The ratings of AIC-J reflect its good risk-adjusted capitalisation and stable financial performance. Offsetting factors include the company's modest business profile and high levels of economic and financial system risk associated with Jordan. AIC-J’s rating receives enhancement from its parent company, ARABIA Insurance Company s.a.l. (AIC).

ARABIA group has a 51% shareholding in AIC-J, with support provided through shared corporate governance and risk management facilities, group reinsurance purchasing and availability of technical expertise.

AIC-J’s risk-adjusted capitalisation has steadily declined in recent years, but remains supportive of its rating. The reduction is largely attributed to AIC-J’s generous dividend policy. Prospective capital adequacy is dependent on the company’s ability to generate sufficient capital internally to support its projected plan.

AIC-J is expected to deliver strong financial results in 2014, with its combined ratio anticipated to remain below 100%. Both motor and medical business lines, which together account for nearly three quarters of gross written premiums, are expected to return to profitability in 2014, driven by corrective actions taken by management during the year. AIC-J remains a fairly small player in Jordan’s fragmented and competitive market.

Although the company is expected to grow over the medium term, its market position is not expected to change dramatically.

Positive rating movement could arise from a stronger track record of underwriting performance, coupled with sustained improvement in the company’s market position in Jordan. A material deterioration in risk-adjusted capitalisation or removal of group support could result in a negative rating action.

The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

Key insurance criteria reports utilised:

• Understanding Universal BCAR
• Evaluating Country Risk
• Risk Management and the Rating Process for Insurance Companies
• Catastrophe Analysis in A.M. Best Ratings
• Rating Members of Insurance Groups

In accordance with Regulation (EC) No. 1060/2009, the following is a link to required disclosures: A.M. Best Europe - Rating Services Limited Supplementary Disclosure.

This press release relates to rating(s) that have been published on A.M. Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please visit A.M. Best’s Ratings & Criteria Center.

A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2015 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

A.M. Best
Salman Siddiqui, ACA, +(44) 20-7397-0311
Financial Analyst
[email protected]
or
Mahesh Mistry, +(44) 20-7397-0325
Director, Analytics
[email protected]
or
Christopher Sharkey, +(1) 908-439-2200, ext. 5159
Manager, Public Relations
[email protected]
or
Jim Peavy, +(1) 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
[email protected]

Source: A.M. Best Company, Inc.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Royal Caribbean to acquire 50% stake in Sandals Resorts for $3 billion
• Interactive Strength reports record Q2 results, raises Q3 guidance
• Cintas Corp. (CTAS) Tops Q1 EPS by 1c, Offers Guidance