Rating agency gives Lloyd's syndicate a boost

Moody's has upgraded the Insurance Financial Strength Ratings (IFSR) of Lloyd's syndicate 2007 - Novae Syndicates - from A3 to A2 in light of the improving overall aggregate financial position and strengthened central resources of Lloyd's, and the syndicate's existing stand-alone credit fundamentals.

Moody's stated that the A2 IFSR on syndicate 2007 reflected its franchise as a leading syndicate within its core business areas in the Lloyd's market and its excellent business diversification.

This is offset by the Novae Lloyd's operation's (including run-off entities) significant gross underwriting leverage (gross premiums written and gross loss reserves relative to shareholders' equity) and the historical impact of reserving adjustments on its ongoing business' profitability.

Albeit that these factors are mitigated by the decreasing level of adverse reserve adjustments and reinsurance recoverables and the quality of the reinsurance recoverables.