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A.M. Best Affirms Ratings of MS Frontier Reinsurance LimitedA.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of "a+" of MS Frontier Reinsurance Limited (MS Frontier) (Hamilton, Bermuda). The outlook for each rating is stable. MS Frontier is a wholly owned subsidiary of Mitsui Sumitomo Insurance Company, Limited (MSI (News - Alert)), which is a subsidiary of MS&AD Insurance Group Holdings, Inc. (MS&AD). The ratings reflect MS Frontier's overall positive operating performance since 2011, when catastrophes negatively impacted the company. In addition, MS Frontier's ratings are enhanced by the global presence, financial support and balance sheet strength of MS&AD. MS Frontier maintains an excellent level of risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio (BCAR). The ratings also take into account the company's structured enterprise risk management framework and practices, and conservative investment portfolio. MS Frontier continues to be a strategic insurance vehicle, having been designed to optimize MSI's geographic portfolio, risk diversification and overseas business expansion. Offsetting risk factors include MS Frontier's eposure to low frequency, high severity events, which could significantly reduce its capital given its focus on property catastrophe reinsurance. MS Frontier writes non-catastrophe business; however, catastrophe business represents the majority of its book. This factor is partially mitigated by retrocession cover. Positive rating actions may result if MS Frontier maintains superior financial performance with lower volatility, continued product diversification and strong risk-adjusted surplus levels. Downward pressure on the rating could arise if there is a decrease in support from the parent. Potential large-scale catastrophe events could also put downward pressure to the ratings if capital levels are significantly affected. This press release relates to rating(s) 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 Recent Rating Activity web page. A.M. Best is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2016 by A.M. Best Rating Services, Inc. ALL RIGHTS RESERVED.
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