A.M. Best Affirms Ratings of Iron Horse Insurance Company

  A.M. Best Affirms Ratings of Iron Horse Insurance Company

Business Wire

OLDWICK, N.J. -- June 21, 2012

A.M. Best Co. has affirmed the financial strength rating of A (Excellent) and
issuer credit rating of “a+” of Iron Horse Insurance Company (Iron Horse)
(Burlington, VT). The outlook for both ratings is stable.

The ratings reflect Iron Horse’s adequate risk-adjusted capitalization,
explicit parental support, experienced management team and the role it plays
as a direct captive subsidiary of Chevron Corporation (Chevron) [NYSE: CVX].

These positive rating factors are partially offset by Iron Horse’s high net
loss exposures, as the coverages provided tend to result in claims that are
characterized as low frequency but high severity. This is somewhat mitigated
by the captive’s ability to secure capital from Chevron in the event of a
covered shock loss. Iron Horse directly benefits from the attention of
Chevron’s experienced risk management team. Iron Horse also gains from
Chevron’s global operations, which provide favorable geographic spread of risk
and line of business diversification.

In its role as a captive insurer, Iron Horse, along with Heddington Insurance
Limited, currently provides broad and competitive global insurance products
for Chevron and its subsidiaries. The insurance needs of Chevron are supplied
through these captive operations (where appropriate) and the commercial

Iron Horse and the other Chevron captives provide comprehensive coverage above
Chevron’s internal retentions, while Iron Horse’s reinsurance is placed
through a corporate wide plan with the world’s leading providers of capacity,
resulting in a diversified and balanced distribution of reinsurers.

A.M. Best remains the leading rating agency of alternative risk transfer
entities, with more than 200 such vehicles rated in the United States and
throughout the world.

For current Best’s Credit Ratings and independent data on the captive and
alternative risk transfer insurance market, please visit

The methodology used in determining these ratings is Best’s Credit Rating
Methodology, which provides a comprehensive explanation of A.M. Best’s rating
process and contains the different rating criteria employed in the rating
process. Key criteria utilized include: “Alternative Risk Transfer”; “Risk
Management and the Rating Process for Insurance Companies”; and “Understanding
BCAR for Property/Casualty Insurers.” Best’s Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more information,
visit www.ambest.com.

       Copyright © 2012 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.


A.M. Best Co.
Janet Hernandez,908-439-2200, ext. 5767
Senior Financial Analyst
Robert DeRose,908-439-2200, ext. 5453
Vice President
Rachelle Morrow, 908-439-2200, ext. 5378
Senior Manager, Public Relations
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
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