A.M. Best has upgraded the financial strength rating to A- (Excellent) from B++ (Good) and the long-term issuer credit rating to “a-” from “bbb+” of AES Global Insurance Company (AGIC), based in Burlington, Vermont.
The outlook of these credit ratings is stable.
The ratings reflect AGIC’s balance sheet strength, which A.M. Best categorises as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.
The ratings also reflect the improved credit profile of AGIC’s parent, the AES Corporation.
AGIC is wholly-owned by AES, a Fortune 500 global energy company that, through its subsidiaries and affiliates, operates a diversified portfolio of generation, distribution and energy storage businesses.
A.M. Best explained that the ratings take into account AGIC’s continued favourable operating trends and risk-adjusted capitalisation, sound risk management capabilities with a focus on sustaining improving capitalisation, underwriting performance and conservative balance sheet strategies. The surplus has more than doubled over the past five years.
The ratings also consider AGIC’s important role as a single-parent captive and the implied support provided by its parent, according to the rating firm.
AGIC is a core element of AES’ overall risk management programme, which utilises the captive as an integral part of this process.
“AES’ continually evaluates the use of AGIC for other risk management objectives of the group as they arise,” A.M. Best added.
