Best’s News & Research Service - May 21, 2015 01:21 PM (EDT)
A.M. Best Affirms Ratings of HDI-Gerling America Insurance Company
Oldwick //BestWire// - A.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of "a+" of HDI-Gerling America Insurance Company (HDI-GAIC) (Chicago, IL). The outlook for both ratings is stable.
The ratings of HDI-GAIC largely reflect its strong risk-adjusted capitalization and favorable operating profitability. HDI-GAIC also benefits from the explicit support provided through substantial internal reinsurance by its immediate parent, HDI-Gerling Welt Service AG (HG-WS), and the immediate parent of HG-WS, HDI-Gerling Industrie Versicherung AG (HG-I), via significant facultative cessions and 95% quota share treaties. These treaties have been in effect since July 1, 2008, and Jan. 1, 2000, respectively.
The ratings also acknowledge the additional support provided by a retroactive reinsurance cover with HG-I that covers any net adverse development on policies incepting prior to Jan. 1, 2000, in addition to the implied support from future parental commitment. HDI-GAIC principally markets global-linked commercial lines business to HG-I clients that have operations in the United States, in addition to participating as an underwriter of business produced by two affiliated underwriting agencies.
Considering the substantial explicit support HDI-GAIC has in place with HG-WS and HG-I, any upward or downward movement on the ratings of either HG-WS or HG-I or revisions in their rating outlooks would influence HDI-GAIC's ratings or outlook. In addition, if HDI-GAIC's risk-adjusted capitalization or operating performance falls markedly short of A.M. Best's expectations, negative rating actions could result.
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. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology .
Key insurance criteria reports utilized:
- Catastrophe Analysis in A.M. Best Ratings
- Rating Members of Insurance Groups
- Risk Management and the Ratings Process for Insurance Companies
- Understanding BCAR for Property/Casualty Insurers
This press release relates to rating(s) that have been published on A.M. Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please visit A.M. Best's Ratings & Criteria Center.
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