LONDON - Friday, March 14th 2014 [ME NewsWire]
(BUSINESS
WIRE)-- A.M. Best has affirmed the financial strength rating of B+
(Good) and issuer credit rating of "bbb-" of National Takaful Company
(Watania) PJSC (Watania) (United Arab Emirates). The outlook for both
ratings remains stable.
The
ratings reflect Watania’s strong prospective risk-adjusted
capitalisation and its developing market profile. An offsetting rating
factor is the execution risk associated with Watania’s expansion plan in
a highly competitive domestic insurance market.
Watania
benefits from strong current and prospective risk-adjusted
capitalisation with sufficient capital to support its strategic plan.
The company’s capital position benefits from a conservative investment
strategy, focused on fixed income securities and low underwriting
leverage. Counter-party credit risk arising from high reinsurance
cessions is supported by a strong reinsurance panel. In 2013, Watania’s
overall earnings were in line with expectations, reporting a marginal
operating loss of AED 2.4 million (USD 0.7 million). Underwriting
performance was affected by high claims experience on motor and property
business lines, but this was offset by improved investment returns.
Watania
remains a small company in the highly competitive UAE insurance market.
The challenge of achieving a stronger market profile, while writing
profitable business, represents a significant level of execution risk.
The
rating is well placed at the current level. Upward or downward rating
movement will be tied to Watania’s ability to successfully execute its
business plan.
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. Best’s Credit Rating Methodology can be found at
www.ambest.com/ratings/methodology.
In
accordance with Regulation (EC) No. 1060/2009, the following is a link
to required disclosures: A.M. Best Europe - Rating Services Limited
Supplementary Disclosure.
A.M.
Best Europe – Rating Services Limited is a subsidiary of A.M. Best
Company. 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 © 2014 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
Contacts
A.M. Best Company, Inc.
Michael Dunckley, +(44) 20 7397 0321
Associate Financial Analyst
michael.dunckley@ambest.com
Mahesh Mistry, +(44) 20 7397 0325
Director, Analytics
mahesh.mistry@ambest.com
Rachelle Morrow, +(1) 908-439-2200, ext. 5378
Senior Manager, Public Relations
rachelle.morrow@ambest.com
Jim Peavy, +(1) 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
james.peavy@ambest.com
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