MetLife rating reaffirmed

Posted by Benji Riggins on June 20, 2009 under Insurance News, Uncategorized | Be the First to Comment

A.M. Best Co. has affirmed the financial strength rating (FSR) of ‘A’ (Excellent) and issuer credit ratings (ICR) of “a+” of MetLife Auto & Home and its nine members, led by Metropolitan Property and Casualty Insurance Company. The outlook for all of the ratings is stable. Best said the “ratings reflect MetLife Auto & Home’s adequate capitalization, consistent operating performance, strong enterprise risk management practices and successful multiple-channel distribution network.” However, offsetting factors include “the group’s moderately elevated underwriting leverage, as well as its exposure to weather-related events. The rating outlook is based on the group’s adequate capital strength, consistently favorable operating trends and the support of its parent company, MetLife, Inc. ” In addition Best noted that “positive rating attributes include MetLife Auto & Home’s geographic diversification and the marketing advantage it derives from the established brand name recognition of MetLife.” The ratings also acknowledge management’s “focused operating strategy, extensive product knowledge and multiple distribution channels. The group has consistently generated capital through operating earnings reflective of disciplined underwriting and a steady stream of investment income. Behind these results is an enterprise risk management structure of oversight committees and work groups that maintain various procedures and contingency plans within MetLife Auto & Home.” Best pointed out that, although MetLife Auto & Home has incurred large catastrophic losses as a result of several hurricanes in recent years, “the group continues to reduce its catastrophe exposure through underwriting initiatives, coverage limitations, increased deductibles and reinsurance protection, which should favorably affect future operating earnings.”