A.M. Best Withdraws Ratings of Islamic Arab Insurance Co. (Salama)

  A.M. Best Withdraws Ratings of Islamic Arab Insurance Co. (Salama)

Business Wire

LONDON -- January 24, 2013

A.M. Best Europe – Rating Services Limited has downgraded the financial
strength rating to B++ (Good) from A- (Excellent) and issuer credit rating to
“bbb+” from “a-“ of Islamic Arab Insurance Co. (Salama) (United Arab
Emirates). The ratings have been removed from under review with negative
implications and assigned a negative outlook. Concurrently, A.M. Best has
withdrawn the ratings as the company has requested to no longer participate in
A.M. Best’s interactive rating process.

The rating actions are due to the uncertainty regarding Salama’s main
subsidiary, BEST RE (L) Limited (BEST RE) (Malaysia), and the potential
implications for Salama’s capitalisation, operating performance and profile.

Salama’s performance in the first three quarters of 2012 was affected by the
adverse development of Thailand flood losses at BEST RE, with Salama’s loss
ratio rising to 76%, against 57% in the same period in 2011. BEST RE
represented 66% of Salama’s gross written premiums in 2011, and therefore is
material to the group.

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 utilised include: “Risk Management and the Rating
Process for Insurance Companies”; “Understanding BCAR for Property/Casualty
Insurers”; “Rating Members of Insurance Groups”; and “Insurance Holding
Company and Debt Ratings”. Best’s Credit Rating Methodology can be found at
www.ambest.com/ratings/methodology.

In accordance with Regulation (EC) No. 1060/2009, the following is a link to
required disclosures: A.M. Best Europe - Rating Services Limited Supplementary
Disclosure.

A.M. Best Europe – Rating Services Limited is a subsidiary of A.M. Best
Company. 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 © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

Contact:

A.M. Best Company, Inc.
Michael Dunckley, +(44) 20 7397 0321
Associate Financial Analyst
michael.dunckley@ambest.com
or
Mahesh Mistry, +(44) 20 7397 0325
Director
mahesh.mistry@ambest.com
or
Rachelle Morrow, +(1) 908 439 2200, ext. 5378
Senior Manager, Public Relations
rachelle.morrow@ambest.com
or
Jim Peavy, +(1) 908 439 2200, ext. 5644
Assistant Vice President, Public Relations
james.peavy@ambest.com