Home / Corporate / AM Best cuts Ansvar outlook to negative
18 May 2020
AM Best has cuts its outlook for church, education and heritage insurer Ansvar to negative from stable due to financial impacts from exposure to physical and sexual abuse claims, discount rate movements and catastrophe events.
The ratings agency says the outlook change reflects a deterioration in key underwriting and operating performance metrics driven by unfavourable underwriting results due to reserve strengthening.
Ansvar reported a return-on-equity ratio of negative 4.5% for 2019, which AM Best describes as a “notable deterioration” from a five-year average of 5.1%.
The combined operating ratio improved in 2017 and 2018, but AM Best says technical performance deteriorated last year and into the first three months of the current year.
“Financial market volatility further strained operating performance in the first quarter,” it said.
Ansvar’s balance sheet strength was at AM Best’s strongest level last year and is expected to remain “at least at a very strong level” over the medium term, while the company has a low-risk investment portfolio.
AM Best affirmed its Financial Strength Rating of A- for Ansvar, which is owned by the UK-based Ecclesiastical Insurance Office.