A.M. Best Affirms Ratings of Hiscox Ltd and Its Subsidiaries
LONDON -- December 5, 2013
A.M. Best Europe – Rating Services Limited has affirmed the financial strength
rating (FSR) of A (Excellent) and issuer credit ratings (ICR) of “a+” of
Hiscox Insurance Company (Bermuda) Limited (Hiscox Bermuda), Hiscox Insurance
Company Limited (Hisco) (United Kingdom) and Hiscox Insurance Company
(Guernsey) Limited (Hiscox Guernsey). Concurrently, A.M. Best has affirmed the
ICR of “bbb+” of Hiscox Ltd (Hiscox) (Bermuda), the ultimate parent holding
company of the Hiscox group of companies. The outlook for the above ratings is
A.M. Best has also affirmed the FSR of A (Excellent) and ICR of “a+” of
Lloyd’s Syndicate 33 (United Kingdom), which is managed by Hiscox Syndicates
Limited (HSL). The outlook for both ratings remains positive.
At the same time, A.M. Best Co. has affirmed the FSR of A (Excellent) and ICR
of “a+” of Hiscox Insurance Company, Inc. (HICI) (Chicago, Illinois, USA). The
outlook for these ratings is stable.
The ratings of Hiscox, Hiscox Bermuda and Hisco reflect the Hiscox group’s
strong consolidated risk-adjusted capitalisation and robust performance
record, as demonstrated by an average five-year combined ratio of 90%. Hiscox
pursues a successful strategy of balancing volatile international catastrophe
business with more stable local specialist business, which has supported its
profitable performance in each of the last five years.
These positive rating factors are partially offset by the group’s significant
exposure to catastrophe losses, through its property reinsurance account in
The ratings of Hiscox Bermuda and Hisco factor the strategic importance of
both companies to the Hiscox group. Each company has established a track
record of good operating performance and has made a positive contribution to
overall earnings during the last five years. The ratings of Hiscox Bermuda are
extended to Hiscox Guernsey, which cedes the majority of its premiums to
Hiscox Bermuda. The ratings of Hiscox Bermuda are also extended to HICI due to
its role in and strategic importance to the Hiscox group. HICI receives
explicit support from Hiscox Bermuda in the form of quota share reinsurance.
The affirmation of the ratings of Lloyd’s Syndicate 33 reflects the underlying
strength of the Lloyd’s market, as well as the syndicate’s strong performance
record and enhanced financial flexibility from the support of Hiscox, which
provides 72.5% of the syndicate’s capacity through its corporate member.
A factor that may lead to positive or negative rating actions for the
syndicate is a change in the ratings of Lloyd’s, which currently has an FSR of
A (Excellent) and an ICR of “a+”, both of which have a positive outlook.
Sustained strong performance and strong consolidated risk-adjusted
capitalisation could put positive pressure on the ratings of the Hiscox
entities over the longer term. However, significant erosion of capital or
prolonged weak performance could put negative pressure on the ratings.
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. Best’s Credit Rating Methodology can be found at
In accordance with Regulation (EC) No. 1060/2009, the following is a link to
required disclosures: A.M. Best Europe - Rating Services Limited Supplementary
A.M. Best Europe – Rating Services Limited is a subsidiary of A.M. Best
Company. A.M. Best Company is the world's oldest and most authoritative
insurance rating and information source. For more information, visit
Copyright © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
A.M. Best Company
Mathilde Jakobsen, +(44) 20 7397 0266
Senior Financial Analyst
Stefan Holzberger, +(44) 20 7397 0288
Managing Director, Analytics
Rachelle Morrow, +(1) 908-439-2200, ext. 5378
Senior Manager, Public Relations
Jim Peavy, +(1) 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
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