A.M. Best Assigns Ratings to Castle Harbour Insurance Limited, Harrington Sound Insurance Limited and Colliers Bay Insurance Company

A.M. Best Co. has assigned a financial strength rating of A (Excellent) and issuer credit ratings of "a" to Castle Harbour Insurance Limited, Harrington Sound Insurance Limited and Colliers Bay Insurance Limited (Cayman Islands) (together known as the captives).

In a release on November 15, A.M. Best noted that the outlook assigned to all ratings is stable. All companies are domiciled in Bermuda, unless otherwise specified.

The ratings and outlook reflect the captives' capitalization and conservative operating strategy. The ratings also consider the captives' critical role and favorable profile as part of the parent company, Schlumberger Limited, as well as its operating performance during the past five years, providing tailored insurance coverage to certain subsidiaries of the parent for certain property/casualty risks.

Partially offsetting these positive rating factors are the captives' relatively large limits in its general liability and property lines of business. Nevertheless, A.M. Best recognizes the substantial financial resources of the captives and its parent.

A.M. Best views the captives' management and corporate strategy as a strengthening factor in its ratings, given the group's conservative underwriting, operational goals and transparency. A.M. Best views the captives' enterprise risk management practices as strong given the impact on its conservative risk culture, defined risk controls and the optimization of its capital and surplus. Other factors considered in A.M. Best's ratings process include, but are not limited to, the diversification in line of business and geography, as well as the support and commitment of the parent and the group's mission.

A.M. Best expects the captives' future operating performance to be stable but strong, and the stable earnings profile should further support the companies to control growth and business writings, which are consistent with the captives' capital and surplus position.

The captives' ratings are not expected to be upgraded and/or its outlook revised within the next 12-24 months as its operating performance and capital position have already been considered in the ratings process. However, A.M. Best could downgrade the group's ratings and/or revise the outlook if its Best's Capital Adequacy Ratio (BCAR) score declines, operating performance and risk profile deteriorate, insured losses deplete capital, significant changes and turnover occur in its management team and/or risk management controls and tolerances, or its parent's ratings deteriorate.

The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides an explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process.

More information:

www.ambest.com/captive

www.ambest.com/ratings/methodology

www.ambest.com

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