Moody's Investor Service of
) affirmed an insurance financial strength (IFS) rating of
Essentia Insurance Company (Essentia), a subsidiary of
), at "A2." However, the outlook for Essentia was changed to
negative from stable by the credit rating agency.
ASPEN INS HLDGS (AHL): Free Stock Analysis
MOODYS CORP (MCO): Free Stock Analysis Report
MARKEL CORP (MKL): Free Stock Analysis Report
ONEBEACON INSUR (OB): Free Stock Analysis
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The rating affirmation of Essentia came on the back of support
provided by Markel's lead insurance operating subsidiary,
Evanston Insurance Company. The support comes in the form of 100%
quota share reinsurance agreement. Evanston carries an "A2" IFS
rating with a negative outlook.
Markel acquired Essentia in Jan, 2013 from
OneBeacon Insurance Group Ltd.
). Essentia works as an insurance underwriter across the United
States and reported $187 million of direct written premiums in
2012, while its policyholders' surplus stood at $26 million at
the end of third quarter of 2013. Essentia's operations strongly
complement Markel's operating policy of aiming specialty business
lines and products in niche markets and with unique risk
Moreover, Markel's lead insurance operating subsidiaries carrying
"A2" IFS rating reflects its sturdy scale and position in excess
and surplus (E&S) and specialty lines, consolidated risk
adjusted capitalization, consistent underwriting earnings and
also the strategic approach towards reserving.
However, Markel's few volatile and long-tail lines of business,
its exposure to catastrophes, and a large part of investment with
equity exposure can drag on the earnings and cause capital
Rating affirmations or upgrades from credit rating agencies play
an important part in retaining investor confidence in the stock
along with maintaining credit worthiness in the market. We
believe that strong ratings will help Markel and its lead
insurance operating subsidiaries to retain investor confidence
and help it write more businesses going forward.
Among other property and casualty insurers, A.M. Best Co.
affirmed FSR of "A" (Excellent) and ICR of "a" for Aspen American
Insurance Company and Aspen Specialty Insurance Company
respectively in Sep, 2013. Both these companies are wholly owned
Aspen Insurance Holdings Limited
). A stable outlook was assigned to all the ratings.
Markel presently carries a Zacks Rank #3 (Hold).