Latest Defense Ind Intl Inc (DFNS) Headlines
Post# of 15
Posted On: 03/09/2014 2:25:21 PM
Latest Defense Ind Intl Inc (DFNS) Headlines
A.M. Best: No Rating Actions Taken on Insurers with Terrorism Exposure Despite Uncertain Future of TRIPRA
A.M. Best Company - AMBest - Thu Dec 19, 10:21AM CST
A.M. Best Co. has determined that no rating action on insurers previously identified as over-reliant upon TRIPRA (Terrorism Risk Insurance Program Reauthorization Act) are necessary at this time. As stated in the October 2013 Bestâ??s Briefing, â??Future of TRIPRA Remains Uncertain, Rating Pressure Intensifiesâ? (Oct. 9, 2013), A.M. Best utilizes a stress test scenario to assess the impact that a particular terrorism attack would have on an insurerâ??s balance sheet via Bestâ??s Capital Adequacy Ratio (BCAR), as if TRIPRA did not exist. As mentioned in the briefing, it was determined that 34 rating units out of a total of 889 failed the initial stress test. In December, all of the affected rating units were brought before a rating committee to evaluate action plans that would be implemented in the event TRIPRA is not renewed or if its protection is materially altered. After a thorough review of these action plans, it was determined that sufficient mitigation initiatives were developed to avoid a material impact to a rating unitâ??s financial strength.
A.M. Best: No Rating Actions Taken on Insurers with Terrorism Exposure Despite Uncertain Future of TRIPRA
A.M. Best Company - AMBest - Thu Dec 19, 10:21AM CST
A.M. Best Co. has determined that no rating action on insurers previously identified as over-reliant upon TRIPRA (Terrorism Risk Insurance Program Reauthorization Act) are necessary at this time. As stated in the October 2013 Bestâ??s Briefing, â??Future of TRIPRA Remains Uncertain, Rating Pressure Intensifiesâ? (Oct. 9, 2013), A.M. Best utilizes a stress test scenario to assess the impact that a particular terrorism attack would have on an insurerâ??s balance sheet via Bestâ??s Capital Adequacy Ratio (BCAR), as if TRIPRA did not exist. As mentioned in the briefing, it was determined that 34 rating units out of a total of 889 failed the initial stress test. In December, all of the affected rating units were brought before a rating committee to evaluate action plans that would be implemented in the event TRIPRA is not renewed or if its protection is materially altered. After a thorough review of these action plans, it was determined that sufficient mitigation initiatives were developed to avoid a material impact to a rating unitâ??s financial strength.
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