AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of "a" of London General Insurance Company Limited (LGI) andLondon General Life Company Limited(LGL). The companies are domiciled in the United Kingdom and are assessed together as the TWG Europe Limited (TWGE) rating unit. The outlook of these Credit Ratings (ratings) is stable. Concurrently, AM Best has withdrawn these ratings as the companies have requested to no longer participate in AM Best's interactive rating process.
The ratings of LGI and LGL reflect TWGE's balance sheet strength, which AM Best categorises as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. The ratings also benefit from rating enhancement from Assurant P&C Group, for which it has strategic importance.
TWGE's balance sheet strength assessment is underpinned by risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio, at the strongest level, supported by modest underwriting leverage and a conservative investment strategy. The assessment also considers TWGE's good financial flexibility, and is offset partially by the relatively small size of its balance sheet, which exposes its risk-adjusted capitalisation to increased potential volatility.
TWGE has a track record of good and stable underwriting performance, with combined ratios consistently below 100%. AM Best expects the company to maintain a low single-digit return on equity over the medium term, which is line with recent experience.
TWGE has a niche profile in the extended warranty and accidental damage segments across Europe, and has a concentrated customer base.
This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best's Credit Ratings. For information on the proper media use of Best's Credit Ratings and AM Best press releases, please view Guide for Media Proper Use of Best's Credit Ratings and AM Best Rating Action Press Releases.
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