Latest news with #AMBest-rated
Business Wire
03-07-2025
- Business
- Business Wire
Best's Commentary: Latest Middle East Turmoil Generates Additional, Familiar Exposures for Insurers; Regional Economy May Feel the Broader Brunt
BUSINESS WIRE)--While the most recent period of military action in the Middle East presents a range of potential geopolitical risk exposure for the insurance industry, the direct impacts will largely be limited by war exclusions and narrowly defined policy triggers, according to a new AM Best report. The Best's Commentary, titled 'Latest Middle East Turmoil Generates Additional, Familiar Exposures for Insurers; Regional Economy May Feel the Broader Brunt,' notes that thus far, there has been no ratings impact for AM Best-rated insurers operating in the region. If tensions escalate, there is a potential impact for insurers who underwrite political risk, trade credit and war risk coverages in the Middle East region. 'Disputes over exclusions may arise from ambiguous policy language, particularly in relation to business interruption claims, where coverage and causality may be contested,' said Mahesh Mistry, senior director, AM Best. 'For example, port closures, logistical delays, and production halts could potentially trigger business interruption claims.' AM Best also notes in the report that a significant impact is evident in the aviation and marine insurance specialty markets. Premiums for ships operating in the Persian Gulf region, particularly through the Strait of Hormuz, have risen sharply to reflect the elevated risk. Aviation insurers have similarly raised rates for carriers flying near the conflict zones. Many countries in the Gulf Cooperation Council (GCC) region are heavily reliant upon the hydrocarbon sector to drive economic growth, according to the report. The GCC comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. AM Best maintained its stable outlook on the GCC in April, but notes that this region could be adversely impacted by second-order effects. 'If events were to escalate and impact energy prices, it is likely to affect opportunities for insurers in the region,' said Ann Modica, director, AM Best. 'Any wider escalation into the GCC region could affect energy prices, and may have repercussions for inflation globally.' To access the full copy of the Best's Commentary on the Middle East, please visit
Associated Press
17-04-2025
- Business
- Associated Press
Best's Special Report: Implications of Business Profiles on Operating Performance
OLDWICK, N.J.--(BUSINESS WIRE)--Apr 17, 2025-- While an insurer's business profile has a foundational role in its earnings stability and surplus growth, concentration by line of business and geography can be key detriments to a respective company's profitability, according to a new report released by AM Best. In its new Best's Special Report, 'Implications of Business Profiles on Operating Performance,' AM Best notes that this concentration aspect is the greatest drag on its business profile assessments, which serve as a key building block in the rating process. Nearly 60% of AM Best-rated U.S. property/casualty (P/C) companies have a concentration sub-assessment of negative, with degree of competition (31%), market position (22%) and product risk (22%) following as less impactful factors. According to the report, there has been a shift in the risk profiles of individual states due to secondary perils, which have become a major cause of insured losses. 'Insurers operating in fewer states or with fewer lines may face greater challenges managing the financial impact of these perils than national insurers that can better diversify their risk,' said Jason Hopper, associate director, AM Best. Approximately 50% of AM Best-rated companies with a limited business profile have their largest concentration in California, New York, Florida and Texas. P/C companies domiciled in these four states accounted for nearly 35% of this segment's downgrades from 2021 through 2024. Concentrations, whether by product or geographic, can lead to heightened climate risk, event risk, limited flexibility, earnings volatility, capital pressure and regulatory risk. However, the report also notes that higher business profile assessments generally correlate with stronger operating performance assessments, demonstrated by a gradual decline in return on revenue and higher volatility in results as business profile assessments worsen. To access a complimentary copy of this special report, please visit © 2025 by A.M. Best Rating Services, Inc. and/or its RIGHTS RESERVED. View source version on CONTACT: Jason Hopper Associate Director Industry Research & Analytics +1 908 882 1896 [email protected] Christopher Sharkey Associate Director, Public Relations +1 908 882 2310 [email protected] Doniella Pliss Director +1 908 882 2245 [email protected] Al Slavin Senior Public Relations Specialist +1 908 882 2318 [email protected] KEYWORD: EUROPE UNITED STATES NORTH AMERICA NEW YORK NEW JERSEY INDUSTRY KEYWORD: PROFESSIONAL SERVICES INSURANCE BUSINESS FINANCE SOURCE: AM Best Copyright Business Wire 2025. PUB: 04/17/2025 08:52 AM/DISC: 04/17/2025 08:52 AM
