AEGIS has ratings affirmed by AM Best

AM Best has affirmed the financial strength rating of A (Excellent) and the long-term issuer credit rating of “a” of Hamilton-based Associated Electric & Gas Insurance Services (AEGIS).

AM Best said that the ratings reflect AEGIS’s balance sheet strength, which it categorises as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The outlook of the credit ratings remains stable.

According to the rating agency AEGIS’ investment strategy emphasises diversification, and a relatively conservative approach to capital preservation and yield enhancement. These favourable rating factors are offset partially by the periodic unfavourable loss experience in certain lines of business over time.

AM Best added that management continues to focus on the company’s operating performance by improving its risk management strategies, including premium rate adjustments, continued refinement of its underwriting criteria and the prudent use of available reinsurance protection. AEGIS continues to demonstrate a significant market profile as evidenced by a high member retention ratio, an adaptive and highly responsive management team, and the continued expansion of programs within its corporate mission.

Although AEGIS is well-positioned at the current rating level, key rating drivers that may lead to positive actions on AEGIS' ratings are sustained favourable underwriting and the company maintaining its risk-adjusted capitalisation at the strongest level.

The rating agency said that key rating drivers that could negatively affect the ratings are increased underwriting volatility, significant investment losses or outsized catastrophic events, in conjunction with a decline in the risk-adjusted capitalisation.