H Best Affirms Ratings of Chubb Corporation and its subsidia

 

Thursday, Mar 05,2009, 8:07:02 PM   Click:

H Best Affirms Ratings of Chubb Corporation and its subsidiaries, AM Best Company NewsRx.com
H Best Co. has affirmed the ratings (FSR) of A + + (Superior) ratings and issuer credit (ICR) of "AA +" of Chubb Group, Insurance Companies (Chubb Group) and its property / casualty members. Same time Best affirmed the ICR and senior debt rating of "AA-" of Chubb Group's holding company, The Chubb Corporation (Chubb) [NYSE: CB]. H Best has also affirmed the debt rating of "a" on the junior subordinated debt, AMB-1 + on the commercial paper and the indicative rating on the shares of Chubb. In addition, Best hours confirmed the FSR of A + + (Superior) and ICR of "AA +" of Chubb Atlantic Indemnity Ltd. (Chubb Atlantic) (Pembroke, Bermuda). The outlook for all of the notes is stable. All companies are domiciled in Warren, NJ, unless specified. (See link below for a detailed list of companies and notes.)

The assertion in the opinion of Chubb reflects the superiority of his group of risk-adjusted capitalization, excellent underwriting and operating performance and favorable global liquidity holding. The ratings also reflect this group of highly respected franchise, expertise risk management, culture and discipline subscription sustainable competitive advantages in its specialty insurance and insurance companies top range.

The essence of Chubb Group's excellent underwriting and operating performance overall with its silences on specific market segments and an excellent strategic business plan execution. Its capital position above May also be attributed to the strong Chubb management and leadership, and broad financial leeway comprehensive and integrated enterprise risk management (ERM).

Chubb has maintained its longstanding and disciplined approach to capital and liquidity management, while the repurchase of 4.7 billion dollars of its common shares over the past three years. The company pre-tax $ 1.3 billion of unrealized depreciation on its fixed income and equity securities during the first nine months of 2008 did not affect above-average financial flexibility , which is reinforced by significant cash resources in the holding company level - $ 2.4 billion at September 30, 2008. However, as is the case with other property / casualty companies, Chubb's GAAP equity and earnings are sensitive to current volatility in financial markets.

Chubb Group of positive factors are partially offset by the significant market share in the sense of professional responsibility. H Best believes that the group of systemic exposure to recent events affecting the industry, including mortgage / credit crisis has weakened the global economy and falling stock market, probably result in a greater frequency and severity of claims, particularly in the financial sector, causing earnings volatility in May. In addition, the group is sensitive to the seriousness of security high losses in the current weakened economy and the natural and human, although AM Best believes that these risks are generally well controlled by the mechanism of exchange and manage financially. Although asbestos and environmental liabilities are less and less of a concern in recent years, the potential emergence of claims remains. Despite these factors, hours Best believes Chubb Group favorably positioned and sufficiently well capitalized to absorb these problems and those posed by competition from growing property / casualty markets.

Chubb Atlantic's ratings recognize secure capitalization, strategic importance and the implicit and explicit financial and operating support provided by Chubb. However, Chubb Atlantic has reported side effects years before the loss reserve development in recent years, largely on discontinued businesses, which resulted in significant underwriting losses and weak performance of the exploitation. H Chubb Best expects net income from the Atlantic to improve in 2008, partly due to lower reserve development, but mainly due to improvements in net income to 99% subsidiary, Chubb do Brasil Companhia de Seguros, an automobile accident and writer in Brazil, which is accounted for under the equity method.

Chubb debt to total capital ratio at September 30, 2008 was 22.6%, up from 19.3% at the end of 2007 and 15.1% at the end of 2006 in large measure because of its large debt issuance in 2007 and 2008 and, in part, the effect on the fairness of the combination of unrealized depreciation on its investments in 2008 and redemptions of 'actions. Taking into account capital management Chubb in 2008, AM Best expects the financial leverage of the company to about 24% at year end. Despite the share buyback program in progress, cash to the holding company are expected to be high at the end of the year and more than sufficient to cover the costs of holding. H Best Chubb conservative views holding cash management favorably, which was considered in the rating company.

For a complete list of The Chubb Corporation FSRS ICRS and debt advice, please visit www.ambest.com/press/122303chubb.pdf. Founded in 1899, PM Best Company is a full-service credit rating organization dedicated to serving the financial and service industries, including insurance companies, banks, hospitals and suppliers of system health care. For more information, visit www.ambest.com.

Copyright © 2009 Investment Weekly News VerticalNews.com by AM Best Co. has affirmed the financial strength rating A + + and credit ratings of the issuer "aa +" of Chubb Group, insurance companies and property / Member accidents. Same time Best affirmed the ICR and senior debt rating of "AA-" of Chubb Group's holding company, The Chubb Corporation [NYSE: CB].