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A.M. Best Comments on Allied World Assurance Company Holdings, AG and Transatlantic Holdings Inc.a?s Merger

^{Published on 2011-06-13 06:35:31 - Market Wire}
 

OLDWICK, N.J.--([ BUSINESS WIRE ])--A.M. Best Co. has commented that the ratings of the subsidiaries of Allied World Assurance Company Holdings, AG (Allied World) (Switzerland) (NYSE: AWH) as well as Transatlantic Holdings, Inc. (Transatlantic) (New York, NY) (NYSE: TRH) and its subsidiaries are unchanged following the announcement of a definitive agreement to merge. All of the rated operating companies of both organizations maintain financial strength ratings of A (Excellent) and issuer credit ratings of aaa, and all ratings have a stable outlook. (See press releases dated August 24, 2010 and December 21, 2010.)

"Risk Management and the Rating Process for Insurance Companies"

This transaction brings two complementary organizations together. With Allied World being predominately a primary writer and Transatlantic a pure reinsurer, the merged entity is expected to enjoy an enhanced business profile that will likely inure benefits in the form of an improved competitive position. The merged entity should also benefit from broader distribution channels, broader product diversity and the benefits of a significant global presence. The transaction is expected to be finalized in the fourth quarter of 2011, subject to regulatory approvals.

The ratings of Allied World and Transatlantic will continue to be actively monitored throughout the transaction period, and the ratings of the merged entity will be reviewed once the transaction is completed and A.M. Best has completed its analysis.

The principal methodology used in determining these ratings is [ Besta™s Credit Rating Methodology -- Global Life and Non-Life Insurance Edition ], which provides a comprehensive explanation of A.M. Besta™s rating

process and highlights the different rating criteria employed. Additional key criteria utilized include: aRisk Management and the Rating Process for Insurance Companiesa; aUnderstanding Universal BCARa; aNatural Catastrophe Stress Test Methodologya; aRating Members of Insurance Groupsa; and aA.M. Besta™s Ratings & the Treatment of Debt.a Methodologies can be found at [ www.ambest.com/ratings/methodology ].

Founded in 1899, A.M. Best Company is the worlda™s oldest and most authoritative insurance rating and information source. For more information, visit [ www.ambest.com ].

Copyright © 2011 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.