Standard & Poor's affirmed its 'A+' long-term counterparty credit and insurer financial strength ratings for composite insurer Allianz Cornhill Insurance. The outlook is negative.
"The ratings reflect ACI's strategic importance to its ultimate parent, Allianz AG; strong business position; and good and improving capitalization, which is driven in part by an improvement in retained earnings," said Standard & Poor's credit analyst Nigel Bond.
The ratings on ACI also benefit from the company's very strong financial flexibility (defined as the ability to source capital relative to requirements), strong investments, strong liquidity, and good and improving operating performance.
Standard & Poor's expects that ACI will remain strategically important to Allianz. In addition, it is expected that ACI will continue to focus on its existing U.K. business lines.
ACI's capital adequacy ratio should reach a strong level by the end of 2003 and remain strong thereafter. Furthermore, Standard & Poor's expects that the net combined ratio will continue to improve to about 98% in 2003 and 2004. Net income for 2003 is likely to be more than double the £60.1 million ($100.2 million) achieved in 2002.
