AM Best revises Axa Mansard’s outlook to stable from negative

A global credit rating, AM Best has revised the outlook of AXA Mansard Insurance Plc to stable from negative and affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-”.

AM Best is a global credit rating agency with over 100 years history of providing quantitative and qualitative assessment for insurance companies, with its “Best’s credit rating methodology.”

A statement said the rating reflected AXA Mansard’s balance sheet strength, which AM Best categorised as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

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The revision in outlook to stable was said to have reflected AM Best’s expectation that AXA Mansard’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio, would remain at the strongest level over the medium term, benefiting from the de-risking of its investment portfolio, and that the company’s underwriting performance will gradually improve.

“AXA Mansard’s balance sheet strength is underpinned by risk-adjusted capitalisation at the strongest level, as measured by BCAR.

“Capital consumption is significantly influenced by the company’s real estate holdings, which in 2018 equated to 73 per cent of its capital and surplus.

“However, AM Best expects that AXA Mansard will significantly reduce its allocation to real estate over the medium term, which would have a positive impact on its future BCAR,” it stated.