Ratings agency to review insurer

Ratings agency to review insurer | Insurance Business

Ratings agency to review insurer
International ratings agency A.M Best has placed the ratings of Ironshore “under review with negative implications,” it has been announced.

The ratings move follows the announcement of a definitive agreement between Ironshore and Fosun International which will see the Chinese business acquire the remaining 80% interest in the international insurer, A.M Best said in a statement.

“A.M. Best acknowledges that Ironshore continues to maintain solid stand-alone rating attributes and the transaction is expected to provide Ironshore with greater access to long-term committed capital and the potential for a more global distribution platform,” the ratings agency said in a statement.

“However, the under review with negative implications status reflects A.M. Best’s concerns regarding Fosun’s credit profile and its financial leverage, which could potentially place a strain on Ironshore’s stand-alone capitalization under certain stress scenarios.”

Ironshore’s current issuer credit rating of “a,”  and its financial strength rating of “A (Excellent)” have been placed under review alongside the ICR of  “bbb” of Ironshore Inc.

A.M Best noted that the review status will remain until the deal is completed, when the ratings agency will take a further look at the combined company.

“The under review status will be removed once the transaction closes and A.M. Best completes its assessment of Fosun, the details of the new capital structure and the implications of Fosun’s ownership of Ironshore,” the statement continued.