AM Best Affirms Credit Ratings of Fairfax Financial Holdings Limited and Majority of Its Subsidiaries

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    OLDWICK, N.J.–(BUSINESS WIRE)–AM Best has affirmed the Long-Term Issuer Credit Rating
    (Long-Term ICR) of “bbb” and the various Long-Term Issue Credit Ratings
    (Long-Term IR) on the unsecured debt and preferred equity of Fairfax
    Financial Holdings Limited (Fairfax) (Toronto, Canada). AM Best
    also has affirmed the Financial Strength Rating (FSR) of A (Excellent)
    and the Long-Term ICRs of “a+” of the subsidiaries of Odyssey Group
    Holdings, Inc. (Odyssey Group). The outlook of the Credit Ratings
    (ratings) is stable. Additionally, AM Best has assigned the FSR of A
    (Excellent) and the Long-Term ICR of “a+” to Newline Europe Versicherung
    AG (Newline AG) (Germany), which has been rated as a member of and added
    to the Odyssey Group. The outlook assigned to the ratings is stable.
    Concurrently, AM Best has affirmed the FSR of A (Excellent) and the
    Long-Term ICRs of “a” of the members of the Crum & Forster Insurance
    Group (C&F), the members of the Zenith National Insurance Group (Zenith
    Group), the members of Northbridge Financial Corporation (Northbridge)
    (Toronto, Canada) and Wentworth Insurance Company Limited (Wentworth)
    (Barbados). In addition, AM Best has affirmed the Long-Term ICRs of
    “bbb” and the Long-Term IRs of Zenith National Insurance Corp.
    (headquartered in Woodland Hills, CA) and Fairfax (US) Inc. (Delaware),
    both of which are indirect wholly owned, downstream holding companies of
    Fairfax. The outlook of these ratings is stable. (See link below for a
    detailed listing of the companies and ratings.)

    The ratings of Odyssey Group reflect its balance sheet strength, which
    AM Best categorizes as strongest, as well as its strong operating
    performance, neutral business profile and appropriate enterprise risk
    management (ERM). The ratings also reflect group member Odyssey
    Reinsurance Company’s (Odyssey Re) rank among the top global reinsurers,
    supported by its diversified global geographic footprint, which includes
    reinsurance and specialty primary insurance, large-line capacity and
    broad product offerings. These positive attributes are supported by
    Odyssey Re’s strongest risk-adjusted capitalization and strong operating
    performance. Somewhat offsetting these strengths is Odyssey Re’s
    challenging operating environment. The ratings assigned to Newline AG
    reflect its strategic importance to the group, as it provides the
    ability to continue servicing customers in the European Union
    post-Brexit. It also reflects the explicit support afforded to that
    entity via a net worth maintenance agreement and reinsurance agreement
    with its parent, Newline Insurance Company Limited.

    The ratings of C&F reflect its balance sheet strength, which AM Best
    categorizes as very strong, as well as its adequate operating
    performance, neutral business profile and appropriate ERM. The ratings
    also reflect the benefits the group derives from its role within the
    larger Fairfax enterprise. C&F also benefits from its diversified and
    growing product portfolio and distribution networks. Management
    continues to focus on growth in its specialty business at appropriate
    rates, terms and conditions. Partially offsetting these positive rating
    factors are the competitive market conditions that persist in the
    commercial lines sector and relatively unfavorable expense levels.

    The ratings of the Zenith Group reflect its balance sheet strength,
    which AM Best categorizes as very strong, as well as its adequate
    operating performance, neutral business profile and appropriate ERM. The
    ratings also are enhanced by the benefits the group derives from its
    position in the Fairfax enterprise. Furthermore, the ratings reflect
    management’s expertise and commitment to maintaining underwriting
    discipline throughout market cycles. Zenith’s underwriting performance
    over many years has outperformed the workers compensation market.
    Somewhat offsetting these positive rating factors is Zenith’s
    concentration of written premium in California and Florida.

    The ratings of Northbridge reflect the group’s balance sheet strength,
    which AM Best categorizes as strongest, as well as its adequate
    operating performance, neutral business profile and appropriate ERM. The
    ratings of Northbridge also acknowledge the group’s position within
    Canada’s commercial insurance market, diversified commercial lines
    franchise and strong broker distribution network. The group continues to
    benefit from improved and strong underwriting performance within its
    small to mid-market commercial segment. Partially offsetting these
    positive rating factors are competitive market conditions that persist
    in Canada’s commercial and personal lines segments, and the group’s
    relatively unfavorable expense levels.

    The ratings of Wentworth reflect its balance sheet strength, which AM
    Best categorizes as very strong, as well as its adequate operating
    performance, limited business profile and appropriate ERM. The ratings
    also are enhanced by the benefits it derives from its position in the
    Fairfax enterprise. In addition, the ratings of Wentworth are supported
    by its historically profitable underwriting performance and loss reserve
    position. The company benefits from its investment portfolio, which
    includes a significant allocation of cash and short-term securities.
    Partially offsetting these positive rating factors are the company’s
    limited business profile and a concentration of property catastrophe
    exposures within its book of business, which subjects it to a
    substantial degree of volatility as evidenced over the past few years.

    A complete
    listing
    of Fairfax Financial Holdings Limited and its subsidiaries’
    FSRs, Long-Term ICRs and Long-Term IRs also is available.

    This press release relates to Credit Ratings that have been published
    on AM 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 see AM Best’s
    Recent
    Rating Activity
    web page. For additional information
    regarding the use and limitations of Credit Rating opinions, please view
    Understanding
    Best’s Credit Ratings
    . For information on the proper media
    use of Best’s Credit Ratings and AM Best press releases, please view
    Guide
    for Media – Proper Use of Best’s Credit Ratings and AM Best Rating
    Action Press Releases
    .

    AM Best is a global rating agency and information provider with a
    unique focus on the insurance industry. Visit
    www.ambest.com
    for more information
    .

    Copyright © 2019 by A.M. Best Rating Services, Inc. and/or its
    affiliates. ALL RIGHTS RESERVED.

    Contacts

    Jennifer Marshall, CPCU, ARM
    Director
    +1 908
    439 2200, ext. 5327

    [email protected]

    Michael
    Lagomarsino, CFA FRM

    Senior Director
    +1 908 439
    2200, ext. 5810

    [email protected]

    Christopher
    Sharkey

    Manager, Public Relations
    +1 908 439
    2200, ext. 5159

    [email protected]

    Jim
    Peavy

    Director, Public Relations
    +1 908 439
    2200, ext. 5644

    [email protected]