OLDWICK, N.J.--(BUSINESS WIRE)--
A.M. Best Co. has affirmed the financial strength rating (FSR) of
A- (Excellent) and issuer credit ratings (ICR) of “a-” of Guardian
Life of the Caribbean Limited(GLOC) and Guardian General
Insurance Limited(GGIL). Concurrently, A.M. Best affirmed the ICR
of “bbb-” of Guardian Holdings Limited (GHL), a publicly traded
holding company and ultimate parent of GLOC and GGIL. The outlook for
all ratings is stable. GHL is listed on the Trinidad and Tobago and
Jamaican stock exchanges. All companies are domiciled in Port of Spain,
The affirmation of the ratings of GLOC and GGIL reflect GHL’s stable
leverage position and consolidated balance sheet strength, favorable
operating results and premium growth for the past several years. The
consistent profitability of both GLOC and GGIL, which are core insurance
subsidiaries of GHL, enhances the overall strength of GHL’s balance
sheet, debt servicing capabilities and consolidated total equity.
Nevertheless, A.M. Best notes that the outstanding level of financial
leverage at GHL remains somewhat high relative to its total equity.
GHL’s exposure in Jamaica through its life insurance subsidiary,
although smaller than in prior years, remains an ongoing concern.
The ratings of GLOC acknowledge its strategic position within the GHL
group, strong competitive advantage in the Trinidad and Tobago markets,
consistently positive gains from operations at both life and pension and
health insurance lines and its adequate level of risk-adjusted
Offsetting these strengths are GLOC’s moderately increased insurance
benefits and claims expenses, the impact of continuing volatility in the
local, regional and global equity markets and the competitive and mature
nature of the Trinidad and Tobago insurance marketplace.
Key rating factors that could result in positive rating actions for GLOC
include near-term reduced exposure to high risk markets, significant
reduction in leverage at the holding company level and an expansion of
the traditional life segment in GLOC’s business mix. Key rating factors
that could result in negative rating actions include increased Jamaican
exposure coupled with heightened sovereign risk, higher leverage at the
holding company level, spread compression as well as deterioration in
the credit quality of its asset portfolio.
The ratings of GGIL recognize its leading regional market presence,
historically profitable operating performance, adequate capitalization
and the support and commitment of GHL. GGIL is the largest
property/casualty writer in the Caribbean with a major presence in
Trinidad and Tobago and several other markets in the region.
Partially offsetting these strengths is the increased frequency of
catastrophic events in the region, the company’s reliance on reinsurance
to protect its earnings and surplus and the increasingly competitive
regional markets in which GGIL operates.
Positive rating actions could occur if GGIL sustains its strong
operating performance and capitalization in combination with an
upgrading of the Trinidad’s country risk rating. Negative rating actions
could occur if either GGIL’s operating performance or risk-adjusted
capitalization is negatively affected beyond A.M. Best’s expectations.
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. Additional key criteria utilized
include: “Evaluating Country Risk”; “Rating Members of Insurance
Groups”; “Risk Management and the Rating Process for Insurance
Companies”; “Understanding BCAR for Property/Casualty Insurers”; and
“Understanding BCAR for Life/Health Insurers.” Best’s Credit Rating
Methodology can be found at www.ambest.com/ratings/methodology.
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 © 2012 by A.M. Best Company, Inc.ALL RIGHTS
A.M. Best Co.Eva Sverdlova—L/H,908-439-2200,
ext. 5733Senior Financial Analysteva.email@example.comRicardo
Longchallon—P/C, 908-439-2200, ext. 5676Senior Financial
Morrow, 908-439-2200, ext. 5378Senior Manager, Public
Peavy, 908-439-2200, ext. 5644Assistant Vice President,
Source: A.M. Best Co.