AM Best Affirm AXIS Capital Holdings Ratings
A.M. Best has affirmed the financial strength rating [FSR] of A+ [Superior] and the issuer credit ratings [ICR] of “aa-” of AXIS Specialty Limited [AXIS] and its operating affiliates. Concurrently, A.M. Best has affirmed the ICR of “a-” and the existing debt ratings of AXIS’ parent, AXIS Capital Holdings Limited [ACHL] [both domiciled in Hamilton, Bermuda]. The outlook for all ratings is stable.
A statement from the rating company said, “The ratings reflect AXIS’ superior risk-adjusted capitalization, long-term track record of strong operating performance through varied market conditions and robust enterprise risk management controls. Historically, AXIS’ book of business focused on short to medium-tail lines and concentrates on specialty risks which can be complex to underwrite, reserve and risk manage.
“AXIS’ operating strategy has emphasized underwriting profitability with balanced risk taking. Given the organization’s risk profile, enterprise risk management controls are imperative to appropriately identify, quantify and mitigate risks prior to becoming problematic issues. A.M. Best believes that AXIS is well suited to execute its business plan. The organization remains nimble and given the current soft casualty market conditions, remains well positioned with a diversified book of business and an expanding worldwide infrastructure.
“AXIS’ historically strong operating performance places it among the top of its Bermuda peer group. In A.M. Best’s opinion, AXIS’ solid performance is attributable to its highly developed and integrated risk management controls and strong systems capabilities. Furthermore, AXIS retains a very strong level of risk-based capitalization under various A.M. Best stress scenarios.
“Partially offsetting these positive rating factors is AXIS’ exposure to large catastrophe losses, as well as the current casualty market environment, which has challenging underwriting conditions. Other rating factors that could lead to a downgrade of AXIS’ ratings or a revision in its outlook to negative include unfavorable operating profitability trends, outsized catastrophe or investment losses relative to its peers, significant adverse loss reserve development and/or a material decline in its risk-adjusted capital. Alternatively, factors that could lead to an upgrade of the company’s ratings include continued long-term favorable operating profitability coupled with maintaining strong risk-adjusted capital levels.”
