AM Best has assigned an issuer credit rating to Hardy Underwriting...
AM Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of “a+” of Lloyd's Syndicate 382, managed by Hardy. At the same time, the agency assigned an ICR of “bbb” to Hardy Underwriting Group (Hardy Group), Hardy's non-operating holding company, and a debt rating of “bbb-” to the $30m subordinated notes due 2036 issued by Hardy Group. The outlook for all ratings is stable.
The ratings reflect syndicate 382's good operating performance, specialist business profile and the financial strength of the Lloyd's market, which underpins the security of all Lloyd's syndicates.
Syndicate 382's financial flexibility is also enhanced by support provided by the Hardy Group, which completed its long-term goal of purchasing the remaining 9.1% of unaligned capital provided to the syndicate and issued $30m floating rate subordinated notes during 2006. This issue will support the expansion of the group's underwriting through Lloyd's Syndicate 3820.
In Best's opinion, syndicate 382 is likely to report an improved return on capacity of approximately 8%-10% for the 2006 year of account, reflecting strong property catastrophe rates, a benign hurricane season and rate softening within its aviation and financial institution accounts.
Best believes syndicate 382 benefits from a specialist business profile, writing a geographically diverse portfolio that consists primarily of aviation, marine and property short-tail risks. Syndicate 382 has maintained its capacity at £110m ($215m) in 2007, with growth in its direct and facultative property account offsetting the softening rating environment in its aviation and financial institution portfolios.
