Rating Agency A.M. Best & Co. has affirmed the issuer credit
rating (ICR) of
White Mountains Insurance Group, Ltd.
) at "bbb." The rating agency also affirmed the ICR at "bbb," along
with the debt ratings, of White Mountains' publicly traded
OneBeacon Insurance Group, Ltd.
) - and OneBeacon's subsidiary - OneBeacon U.S. Holdings, Inc. ("OB
Additionally, A.M. Best affirmed the financial strength rating
(FSR) at "A" and ICR at "a" of OneBeacon Insurance Company and its
six pooled and four reinsured affiliates, all of which are
subsidiaries of OB Holdings. The rating agency also conferred an
FSR of "A" and ICR of "a" to the recently created subsidiaries of
OneBeacon Insurance Company - OBI National Insurance Company and
Homeland Insurance Company of Delaware.
Further, A.M. Best affirmed the FSR of Potomac Insurance Company
- an insurance subsidiary of OneBeacon Insurance Group, which has
been placed in runoff - at "B++" and ICR at "bbb+." All the above
mentioned ratings carry a stable outlook.
A.M. Best affirmed the ratings of White Mountains, OneBeacon
Insurance Group and OB Holdings on the basis of the impressive
financial flexibility and the strong operating results of the
operating subsidiaries of these companies. Further, the rating
agency affirmed the ratings of OneBeacon Insurance Company and its
affiliates due to their strong operating and underwriting results,
which led to robust earnings, along with their exemplary
risk-adjusted capitalization and the financial flexibility of OB
Holdings and OneBeacon Insurance Group.
However, these positives of OneBeacon Insurance Company and its
affiliates were partly offset by the unfavorable loss reserve
development in their runoff business. The risk associated with
reduced diversification due to the divestiture of the personal and
standard commercial business lines also adversely affected the
ratings. However, this risk was more or less counterbalanced by the
profitability of the specialty business.
While the stable outlook on the ratings indicates low
possibility of revision in the near future, prolonged sturdiness in
the underwriting and operating results could lead to an upward
revision in ratings. On the other hand, below expectation
underwriting and operating performance and deterioration in
risk-adjusted capitalization could lead to a downward revision.
White Mountains currently carries a short-term Zacks #4 rank
(Sell) while OneBeacon carries a Zacks #3 Rank (Hold). We maintain
a long-term 'Neutral' recommendation on both companies.
ONEBEACON INSUR (OB): Free Stock Analysis
WHITE MTN INS (WTM): Free Stock Analysis Report
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