A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and issuer credit rating of "a-" of United Insurance Company Limited (United) (Barbados).

The outlook for both ratings is stable.

The ratings reflect United's solid capitalization, historically favorable underwriting performance and strong regional market profile. Furthermore, United enjoys full support from its ultimate parent, Neal and Massy Holdings Limited, a large Caribbean-based conglomerate, which is publicly traded on the Trinidad and Tobago and Barbados stock exchanges.

United's net income has been impacted by significant operating losses stemming from its assumed reinsurance segment over the past several years, culminating in 2011 with a net loss for the company. United's management team has undertaken corrective action plans to exit and run-off its assumed reinsurance business and to refocus its operating strategy on its core Caribbean book of business. Although exiting from its assumed reinsurance line of business is anticipated to have considerable costs over the next several years, it is A.M. Best's expectation that United's renewed concentration on its core businesses should return the company to its former level of profitability.

While the outlook for United is currently stable, potential negative rating triggers could include protracted adverse operating results that are exacerbated by a large catastrophic event. Positive rating actions could occur if the company exhibits sustainable long- term improvements in operating performance coupled with improvements in Barbados' macroeconomic environment and country risk tier.

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. Key criteria utilized include: "Risk Management and the Rating Process for Insurance Companies"; "Understanding BCAR for Property/Casualty Insurers"; "Understanding Universal BCAR"; "Catastrophe Analysis in A.M. Best Ratings"; "Evaluating Non-Insurance Ultimate Parents"; "Insurance Holding Company and Debt Ratings"; and "Assessing Country Risk." Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

More information:

http://www.ambest.com

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