A.M. Best Co. upgraded the issuer credit ratings (ICR) of
AXIS Capital Holdings Limited
) to "a-" from "bbb+". The debt ratings were also upgraded.
Concurrently, the rating agency upgraded the financial strength
rating (FSR) to A+ (Superior) from A (Excellent) and ICR to "aa-"
from "a+" of AXIS Specialty Limited and its operating
affiliates. AXIS Specialty Limited is the subsidiary of
AXIS Capital Holdings.
Subsequently, the outlook for the ratings was revised to stable
The rating upgradation came on the back of AXIS Specialty's
sturdy risk adjusted capitalization, and sustained solid
operational performances based on solid enterprise risk
management controls. At the same time, exposure to
catastrophe losses and soft casualty market conditions dwarf the
positives. Nevertheless, riding on the strength of diversified
product portfolio and global footprint, the company is well
positioned to navigate soft casualty market conditions.
Rating affirmations or upgrades from credit rating agencies play
an important role in retaining investor confidence in the stock
and in maintaining credit worthiness in the market. Rating
downgrades, therefore, adversely affect the business, apart from
increasing the costs of future debt issuances. We believe that
strong ratings will help AXIS Capital retain investor confidence
and enable it to write more businesses going forward, thereby
In this regard, A.M. Best stated that the rating can be further
upgraded if the company successfully maintains the trend of
delivering operating profitability as well as strong
However, the rating agency can revise the ratings downward or
change the outlook on the ratings following several factors.
These include deterioration in operating profitability, suffering
of significant catastrophe or investment losses, an adverse loss
reserve development, and erosion in risk-adjusted capital.
Recently, A.M. Best affirmed the ICRs of
Donegal Group Inc
Argo Group International Holdings, Ltd
), among other property and casualty insurers. While Donegal
Group and Argo Group retains the ICR of "bbb", RLI Corp. retains
the ICR of 'a'.
AXIS Capital Holdings presently carries a Zacks Rank #3
ARGO GROUP INTL (AGII): Free Stock Analysis
AXIS CAP HLDGS (AXS): Free Stock Analysis
DONEGAL GRP -A (DGICA): Free Stock Analysis
RLI CORP (RLI): Free Stock Analysis Report
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