|[November 15, 2012]
A.M. Best Affirms Ratings of Fair American Insurance and Reinsurance Company
OLDWICK, N.J. --(Business Wire)--
A.M. Best Co. has affirmed the financial strength rating (FSR) of
A (Excellent) and issuer credit rating (ICR) of "a" of Fair American
Insurance and Reinsurance Company (FAIRCO) (New York, NY). The
outlook for the FSR is stable, while the outlook for the ICR is positive.
The affirmations are based on FAIRCO's recently executed quota share
agreement with its parent company, Transatlantic Reinsurance Company
(Transatlantic) (New York, NY), which will cede 90% of all ongoing
business to its parent. Simultaneously, all prior FAIRCO business was
Going forward, FAIRCO will focus on various primary lines of business.
A.M. Best expects operating results to be profitable and risk-based
capitalization to remain fully supportive of the company's business plan.
Due to the strong reinsurance arrangement with Transatlantic, FAIRCO
could receive positive rating enhancementif Transatlantic's ratings are
upgraded. Conversely, FAIRCO could experience negative rating actions if
Transatlantic's ratings are downgraded.
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. Key criteria
utilized include: "Risk Management and the Rating Process for Insurance
Companies"; "Understanding BCAR for Property/Casualty Insurers";
"Catastrophe Analysis in A.M. Best Ratings"; "Understanding Universal
BCAR"; and "Rating
Members of Insurance Groups" Best's Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.
Founded in 1899, 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 © 2012 by A.M. Best Company, Inc. ALL RIGHTS
[ Back To Insurance Technology Homepage's Homepage ]