A.M. Best Upgrades Lloyd's
NU Online News Service, Aug. 12, 10:04 a.m. EDT?A.M. Best Co. has upgraded the rating of Lloyd's of London saying the market shows improved capitalization, but there is still worry about the long-term effects from asbestos and environmental risk.[@@]
The Oldwick, N.J.-based insurance rating service raised the financial strength rating to "A" (Excellent) from "A-minus" (Excellent). Best also assigned an issuer credit rating of "a" to Lloyds. The outlook is stable, the rating service added.
Best said the rating reflected "Lloyd's improving prospective capitalization, strong operating performance, its global reach and improvements in risk management."
However, Best added, regarding asbestos and environmental reserve run-off, "A partially offsetting factor is Lloyd's exposure to long-term uncertainty relating to the adequacy of Equitas' reserves, although A.M. Best believes that Lloyd's is unlikely to be adversely affected by Equitas in the near term."
In response, Lloyd's Chief Executive, Nick Prettejohn said in a statement, "I am delighted that A.M. Best has recognized and rewarded Lloyd's underlying financial strength and excellent prospects for the future.
"I am particularly pleased that A.M. Best has highlighted the significant progress we are making to ensure Lloyd's is consistently high-performing and financially resilient."
"Today's announcement will be recognized as a hard-earned vote of confidence in Lloyd's, enhancing the attractiveness of the Lloyd's market to policyholders and capital providers," added Roger Sellek, commercial director at Lloyd's.
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