A.M. Best Europe Rating Services has affirmed the financial strength rating of B++ (Good) of InterGlobal Insurance Company Limited (InterGlobal).
The rating reflects InterGlobal's improved and sustainable level of both risk-adjusted capitalisation and financial flexibility through a capital injection from a strong insurance organization.
An offsetting rating factor is the company's very poor underwriting performance in recent years. Challenging conditions during 2009 and 2010 within the international private medical insurance market together with a select number of poorly performing non-experience rated large accounts in InterGlobal's portfolio are expected to lead to a peak underwriting loss of around US$ 12 million in financial year 2011.
The management's actions of pruning loss-making business, portfolio re-pricing and containing premiums expansion during underwriting year 2011 are expected to produce positive technical results in financial years 2012 and 2013. In 2011, a US$ 15 million capital injection and a new whole account outward quota share reinsurance agreement served to mitigate the impact of the negative operating performance on risk-adjusted capitalization and boosted the latter to a solid level.
With so many insurers being downgraded by rating agencies, this is good news