AP NEWS

A.M. Best Affirms Credit Ratings of Oil Casualty Insurance, Ltd

September 21, 2018

OLDWICK, N.J.--(BUSINESS WIRE)--Sep 21, 2018--A.M. Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of Oil Casualty Insurance, Ltd (OCIL) (Hamilton, Bermuda). A.M. Best also has affirmed the Long-Term Issue Credit Rating of “bbb” on the $200 million 8.00% deferrable subordinated debentures due Sept. 15, 2034. The outlook of these Credit Ratings (ratings) remains stable.

The ratings reflect OCIL’s balance sheet strength, which A.M. Best categorizes as strongest, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM).

The ratings also acknowledge the many strengths of the company’s niche market focus as a dedicated provider of excess general liability coverage to its shareholders and non-shareholder policyholders that operate primarily in the energy industry. OCIL has diversified its business in recent years through assumed reinsurance treaties, and has expanded into direct and treaty/facultative property coverage within the energy sector, resulting in a reduction of overall volatility of the company’s book of business. The company, in recent years, has expanded its insurance and reinsurance operations to provide property/casualty insurance to global companies outside the energy industry.

Partially offsetting these positive rating factors is the impact on underwriting results from occasional outsized shock losses, which is mitigated somewhat by retrocessional reinsurance cover purchased by the company. In addition, the company’s capital base is exposed to volatility from its equity portfolio and hedge fund investments.

OCIL’s ERM program has proven effective at controlling losses over the past several years. The management team is very seasoned, with its members having a number of years of experience in the insurance, financial and energy industries. They also possess a demonstrated track record of successfully implementing strategic initiatives.

A key rating factor that could lead to a positive rating action are favorable underwriting results combined with a reduction in their volatility.

Negative rating actions could result from material declines in the company’s risk-adjusted capitalization and a sustained decay in operating performance.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s web page. For additional information regarding the use and limitations of Credit Rating opinions, please view . For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view .

A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit for more information.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com:https://www.businesswire.com/news/home/20180921005376/en/

CONTACT: A.M. Best

Guilherme (Guy) Monteiro Simoes

Senior Financial Analyst

+1 908 439 2200, ext. 5301

guy.simoes@ambest.com

or

Steven M. Chirico, CPA

Director

+1 908 439 2200, ext. 5087

steven.chirico@ambest.com

or

Christopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com

or

Jim Peavy

Director, Public Relations

+1 908 439 2200, ext. 5644

james.peavy@ambest.com

KEYWORD: UNITED STATES EUROPE NORTH AMERICA NEW JERSEY

INDUSTRY KEYWORD: PROFESSIONAL SERVICES FINANCE INSURANCE

SOURCE: A.M. Best

Copyright Business Wire 2018.

PUB: 09/21/2018 10:59 AM/DISC: 09/21/2018 10:58 AM

http://www.businesswire.com/news/home/20180921005376/en

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