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AM Best Affirms Credit Ratings of Argo Group International Holdings, Ltd. and Subsidiaries
[October 09, 2019]

AM Best Affirms Credit Ratings of Argo Group International Holdings, Ltd. and Subsidiaries

AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICRs) of "a" of Argo Re Ltd. (Argo Re) (Pembroke, Bermuda) and its subsidiaries. AM Best also has affirmed the Long-Term ICR of "bbb" and the Long-Term Issue Credit Ratings (Long-Term IR) of the parent holding company, Argo Group International Holdings, Ltd. (Argo Group) (Pembroke, Bermuda) [NYSE: ARGO]. Concurrently, AM Best has affirmed the Long-Term ICR of "bbb" and the Long-Term IR of "bbb" on $143.75 million 6.5% senior unsecured notes due 2042 of Argo Group US, Inc. (Argo US) (headquartered in San Antonio, TX). These senior notes are fully and unconditionally guaranteed by Argo Group. The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies and ratings.)

The ratings reflect Argo Group's balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

Argo Group's balance sheet strength reflects its risk-adjusted capitalization being at the strongest level, as measured by Best's Capital Adequacy Ratio (BCAR), at each of the various value at risk levels. This also takes into consideration the effective use of third-party capital and enhanced financial flexibility as a publicly traded company listed on the New York Stock Exchange, with ready access to global capital markets, and the strength of Argo's loss reserves as reflected in its long history of favorable reserve development, although there was some volatility in the first half of 2019 from its international segment. The group's operating performance is generally in line with its peers when considering its specialty U.S. insurance operations and international platforms. This is tempered somewhat by the group's expense ratio, which, although improving, is consistently higher than peers. The ratings also consider the group's diversified operations around the globe, its multiple product offerings and multi-prong dstribution strategy, as well as its investment in technology and initiatives to innovate and optimize efficiency. The ratings also acknowledge the breadth and maturity of Argo Group's ERM programs, which is comprehensive and well-embedded in its operation, and have been used to manage risk and setting business strategy.

The FSR of A (Excellent) and the Long-Term ICRs of "a" have been affirmed for Argo Re Ltd. and its following subsidiaries:

  • ArgoGlobal SE
  • Argonaut Great Central Insurance Company
  • Argonaut Insurance Company
  • Argonaut Limited Risk Insurance Company
  • Argonaut-Midwest Insurance Company
  • Argonaut-Southwest Insurance Company
  • ARIS Title Insurance Corporation
  • Colony Insurance Company
  • Peleus Insurance Company
  • Colony Specialty Insurance Company
  • Rockwood Casualty Insurance Company
  • Select Markets Insurance Company
  • Somerset Casualty Insurance Company

The following indicative Long-Term IRs available under various shelf registrations have been affirmed:

Argo Group International Holdings. Ltd. -
-- "bbb" on senior unsecured debt
-- "bbb-" on subordinated debt
-- "bb+" on preferred stock

Argo Group US, Inc. -
-- "bbb" on senior unsecured debt
-- "bbb-" on subordinated debt

Argo Group Statutory Trust -
-- "bb+" on preferred stock

The following Long-Term IR has been affirmed:

Argo Group US, Inc. -
-- "bbb" on $143.75 million 6.5% senior unsecured notes, due 2042

This press release relates to Credit Ratings that have been published on AM 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 AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best's Credit Ratings. For information on the proper media use of Best's Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best's Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global rating agency and information provider with an exclusive focus on the insurance industry. Visit for more information.

Copyright © 2019 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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