Under Standard & Poor’s Ratings Services’ latest review, the American P&I Club’s financial strength rating has been raised a full notch from BB+ to BBB-, an investment grade, with a stable outlook.
This action follows a comprehensive review of the club’s current and prospective circumstances by reference to S&P’s new criteria for the rating of insurance companies which it has now extended to 14 marine mutual insurers.
In their rationale for increasing the club’s rating to an investment grade, S&P referred, inter alia, to its improved view of the club’s prospective capital adequacy, its business risk profile and competitive position. The agency also referred to the club’s enhanced underwriting risk controls which, among other things, have caused the club’s average loss ratios to register a downward trend in recent years.
Speaking in New York, Joe Hughes, chairman and ceo of SCB Inc., the managers, said that the agency’s step-up to an investment grade was a very positive development for the 96-year-old American Club.
He added: “Given the significance sometimes attached in certain sectors to an S&P investment grade rating, it will amplify our continuing outreach in serving the global maritime community.”
The American Club was founded in February 1917. In addition to its US headquarters in New York, the club is able to provide local service across all time zones, communicating in 11 languages, with subsidiary offices in London, Piraeus and Shanghai and a worldwide network of correspondents.