| [February 14, 2012] |
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A.M. Best Affirms Ratings of Seguros Inbursa, S.A. Grupo Financiero Inbursa
OLDWICK, N.J. --(Business Wire)--
A.M. Best Co. has affirmed the financial strength rating of A
(Excellent) and issuer credit rating of "a" of Seguros Inbursa, S.A.
Grupo Financiero Inbursa (Seguros Inbursa) (Mexico). The outlook for
both ratings is stable.
The ratings reflect Seguros Inbursa's solid risk-adjusted
capitalization, overall historical profitability and diversified
business profile. The ratings also reflect the company's affiliation
with Grupo Financiero Inbursa S.A.B. de C.V., one of the largest
financial groups in Mexico.
Seguros Inbursa writes both life and non-life business and remains one
of the larger and more profitable domestic insurance companies operating
in Mexico. The company's focus on expense management, along with
consistent levels of investment income, has historically resulted in
favorable overall earnings. This has enabled Seguros Inbursa to continue
to enhance its risk-adjusted capitalization. In addition, Seguros
Inbursa continues to benefit from synergies and significant operating
efficiencies as a result of its access to Grupo Financiero Inbursa's
vast financial and system networks.
Partially offsetting thse positive rating factors are Seguros Inbursa's
continuing underwriting losses in key business segments and its reliance
on investment income for its overall earnings. In addition, the Mexican
insurance market remains very competitive, and Seguros Inbursa will be
challenged to maintain profitability and market share.
While Seguros Inbursa is well positioned at its current rating level,
factors that may lead to rating enhancement include sustained
improvement in the company's underwriting performance and an upgrade in
Mexico's country risk tier rating.
Factors that may lead to negative rating actions include weaker than
expected operating performance, a sustained decline in underwriting
profitability, significant deterioration in risk-adjusted capitalization
as measured by Best's Capital Adequacy Ratio and a downgrade in Mexico's
country risk tier rating.
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 Universal BCAR"; "Understanding BCAR for
Property/Casualty Insurers"; "Catastrophe Analysis in A.M. Best
Ratings"; "A.M. Best's Ratings & the Treatment of Debt"; and "Assessing
Country Risk." 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
RESERVED.
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