Moody's Assigns 'A3′ Rating To Montpelier Re
NU Online News Service, June 19, 12:21 p.m. EDT?Montpelier Reinsurance, a Bermuda-based property catastrophe and specialty property reinsurer, has been assigned an "A3″ (Good) insurance financial strength rating, with a "stable" outlook, from Moody's Investors Service.
Montpelier Re is one of the new Bermuda-based reinsurers that emerged in the aftermath of the 9/11 terror attacks. The company, which was founded by White Mountains Insurance Group and Benfield Holdings, began operating in December 2001 with some $1 billion of capital.
The Montpelier holding company, Montpelier Re Holdings, completed an initial public offering on the New York Stock Exchange last October, raising more than $200 million in the process. In 2003 first quarter, it posted a net income of $104 million from $202 million in revenues.
Moody's cited a number of favorable factors at Montpelier Re, including the company's "meaningful capital base, conservative operating and financial leverage profile and efficient operations." The New York-based ratings firm also pointed out that, as a newly formed company, Montpelier Re's balance sheet is "unencumbered by historical loss exposures."
Moody's also expressed some concerns, however, noting that these strengths are tempered by the inherent volatility of property catastrophe and property risk excess of loss reinsurance business.
"We are proud to receive a Moody's 'A3′ rating, especially as a young company," said Anthony Taylor, chief executive officer at Montpelier Re. "Although founded less than 18 months ago, we have already accumulated a substantial capital base and a reputation for excellent service and thoughtful underwriting.
"The Moody's rating reflects our solid business approach and demonstrates our financial strength to our clients," Mr. Taylor said.
Late last month, Montpelier Re received a favorable ratings action from Oldwick, N.J.-based A.M. Best, which upgraded its previous "A-Minus" (Excellent) financial strength rating for the reinsurer to "A" (Excellent).
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