The ratings reflect AEGL’s excellent stand alone risk-adjusted capitalization, solid operating performance and excellent business profile,” said Best. The ratings also reflect the implicit support provided to AEGL by its parent company, Zurich-based ACE Limited and “AEGL’s importance within the ACE group, which benefits from a diversified global operation and a consistently favorable record of generating strong earnings and cash flows.
“AEGL continues to be of strategic significance to ACE as its main underwriting operation in the United Kingdom and continental Europe. In addition, AEGL receives significant reinsurance support from ACE group affiliates.”
Best indicated that it expects AEGL “to maintain excellent stand-alone risk-adjusted capitalization in 2012, supported by solid retained earnings. In both 2010 and 2011, shareholders’ funds increased by over 6 percent in spite of dividends paid following the company’s strong operating performance in the previous year.”
However, Best also pointed out that “market conditions continue to be challenging, and AEGL is currently expecting to report a lower technical result in 2012 than the
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