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A.M. Best Places Ratings of Exporters Insurance Company Ltd. Under Review CONTACTS:
FOR IMMEDIATE RELEASE OLDWICK, NEW JERSEY, U.S.A., Nov. 14, 2008—A.M. Best Co. has placed the financial strength rating of A- (Excellent) and issuer credit rating of “a-”of Exporters Insurance Company Ltd. (Exporters) (Bermuda) under review with negative implications. A.M. Best also has affirmed the ratings. The ratings of Exporters reflect the company’s superior risk-adjusted capitalization, proven performance through market cycles and continued growth in capital and surplus. The ratings also recognize Exporters’ conservative approach to investment management and strong market position among its membership. Partially offsetting these positive factors are the potential exposure to significant net losses due to major company specific and global economic events. One of these downturns was experienced in 2002 and 2001 and was the result of financial difficulties in an emerging market country coupled with the contraction within the telecommunications industry. The recovery in Exporters’ results after 2003 is due to loss activity returning to historical levels after the settlement of several large claims resulting from exposures in Argentina and, to a lesser extent, other locales. Capital and surplus increases primarily are due to the retention of net income coupled with additional capital raised from new members, partially offset by the redemption of some participants’ underutilized capital contributions. Exporters’ ratings have been placed under review with negative implications due to the announcement that it has entered into an agreement with QBE Holdings Inc. (QBE) for QBE to acquire Exporters’ core underwriting and risk management group and to administer the run off of Exporters’ existing portfolio. The transaction is expected to formally close on November
21, 2008. Exporters’ has ceased underwriting any new or renewal
business. All risks assumed by Exporters prior to closing are expected
to stay on Exporters’ The ratings and their under review status will be reviewed subsequent to the closing of the transaction between Exporters and QBE and after the run-off status and projections can be evaluated. A.M. Best remains the leading rating agency of captive insurers rating a wide variety of more than 200 captives in the United States and throughout the world. For current Best’s Ratings and independent data on the captive and alternative insurance market, please visit www.ambest.com/captive. Founded
in 1899, A.M. Best Company is a global full-service credit rating organization
dedicated to serving the financial and health care service industries,
including insurance companies, banks, hospitals and health care system
providers. For more information, visit www.ambest.com.
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