OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and issuer credit rating (ICR) of "a-" of International General Insurance Company Limited (IGI) (Bermuda). A.M. Best also has affirmed the ICR of "bbb-" of International General Insurance Holdings Limited (IGIH) (Dubai). The outlook for all ratings is stable.

The ratings reflect IGI's resilient risk-adjusted capitalisation and improving business profile. Offsetting factors are the company's poor underwriting performance in 2008 and the impact of the economic downturn that may restrict premium volumes in spite of a hardening of rates.

IGI's risk-adjusted capitalisation declined significantly from the large underwriting losses in 2008 on its marine and energy portfolios. Notwithstanding this, A.M. Best believes that IGI's prospective risk-adjusted capitalisation is likely to remain supportive of its compounded annual average gross written premium growth of around 14% over the next three years. IGI's absolute level of economic capital of USD 166 million expected in 2009 is viewed as reasonable and is expected to be further improved by higher anticipated earnings in the medium term.

In A.M. Best's opinion, IGI's operating performance has been severely impacted by the unexpected Gulf of Mexico windstorm and major marine losses in the range of USD 20 million in 2008. For 2009, A.M. Best will be monitoring IGI's underwriting profitability given the new reinsurance arrangements and withdrawal from loss-making areas of the portfolio. A.M. Best expects a return to combined ratio of around 96% amidst a backdrop of downturns in the underwriting and economic cycles, softened by an increase in rates. IGI's prospective return on equity also is likely to improve to approximately 10% -11% from lesser volatility in capital markets over 2009 (-2.9 % in 2008).


Since the assignment of ratings in 2008, IGI's business profile has improved and premiums are likely to grow in the medium term, albeit with a better selection of risks taken. The marine business, although representing around 27% in 2008, is not likely to be an area of growth as IGI takes measures to mitigate its continuing unprofitability. In A.M. Best's view, IGI will benefit from the rapid expansion in its business only if future operating performance does not prove to be a constraint.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

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.

A.M. Best Company

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Anandi Nangy-Kotecha, +(44) 20 7626 6264

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Source: A.M. Best Company