A.M. Best has affirmed the financial strength ratings (FSR) of A+
(Superior) and the issuer credit ratings (ICR) of “aa-” of the members
of Intact Insurance Group (Intact Group), which are Belair
Insurance Company Inc. (Quebec), Intact Insurance Company, Novex
Insurance Company, The Nordic Insurance Company of Canada, Trafalgar
Insurance Company of Canada and Jevco Insurance Company, as
well as its separately rated member, Intact Farm Insurance Inc.
(IFI) (Quebec). All companies are domiciled in Ontario, unless otherwise
specified. In addition, A.M. Best has affirmed the ICR of “a-” and all
debt ratings of the ultimate parent company, Intact Financial
Corporation (IFC) [TSX:IFC]. The outlook for all ratings is stable.
(Please see below for a detailed listing of the debt ratings.)
The ratings reflect Intact Group’s strong risk-adjusted capitalization,
leading market position within the Canadian property/casualty insurance
industry and its market access through multiple channels of distribution
and geographic diversification. In addition, Intact Group continues to
demonstrate its pricing and segmentation expertise and efficient claims
management. The ratings also continue to benefit from the added
financial flexibility of IFC, whose shares are listed and traded on the
Toronto Stock Exchange. Partially offsetting these rating strengths are
the challenges the organization faces given a trend of more frequent and
severe storms across Canada and the strong competition for market share.
The rating affirmations for IFI acknowledge its strong risk-adjusted
capitalization, expertise in farm property and liability insurance in
Quebec, favorable earnings over the past five years and quality surplus
protection and synergies with IFC, such as its corporate reinsurance
program. Partially offsetting these positive rating factors is IFI’s
concentration of farm risk in Quebec.
The following debt ratings have been affirmed:
Intact Financial Corporation—
-- “a-” on CAD 250 million, Series 1, 5.41% senior unsecured medium-term
notes, due September 3, 2019
-- “a-” on CAD 250 million, Series 2, 6.40% senior unsecured medium-term
notes, due November 23, 2039
-- “a-” on CAD 300 million, Series 4, 4.70% senior unsecured medium-term
notes, due August 18, 2021
-- “a-” on CAD 200 million, Series 5, 5.16% senior unsecured medium-term
notes, due June 16, 2042
-- “a-” on CAD 50 million, Series 5, 5.16% senior unsecured medium-term
notes, due June 16, 2042
The following indicative ratings under the shelf registration have been
affirmed:
Intact Financial Corporation—
-- “a-” on senior unsecured debt securities
-- “bbb+” on subordinated unsecured debt securities
-- “bbb” on Class A preferred shares (included in the CAD 3 billion
preliminary short form base shelf prospectus)
The ratings and outlook of members of Intact Group could benefit from a
consistently favorable earnings trend that outperforms peers, while
maintaining superior risk-adjusted capitalization. However, the ratings
and outlook may come under negative pressure if an unfavorable earnings
trend develops and/or the group’s risk- adjusted capital erodes.
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.
Key insurance criteria reports utilized:
-
Catastrophe Analysis in A.M. Best Ratings
-
Insurance Holding Company and Debt Ratings
-
Rating Members of Insurance Groups
-
Risk Management and the Rating Process for Insurance Companies
-
Understanding BCAR for Canadian Property/Casualty Insurers
-
Understanding Universal BCAR
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 visit A.M. Best’s Ratings
& Criteria Center.
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 © 2015 by A.M. Best Company, Inc. ALL RIGHTS
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Copyright Business Wire 2015