Chevron Corporation : A.M. Best Affirms Ratings of Iron Horse Insurance Company
06/21/2012| 02:05pm US/Eastern
A.M. Best Co. has affirmed the financial strength rating of A
(Excellent) and issuer credit rating of "a+" of Iron Horse Insurance
Company (Iron Horse) (Burlington, VT). The outlook for both ratings
The ratings reflect Iron Horse's adequate risk-adjusted capitalization,
explicit parental support, experienced management team and the role it
plays as a direct captive subsidiary of Chevron Corporation
(Chevron) [NYSE: CVX].
These positive rating factors are partially offset by Iron Horse's high
net loss exposures, as the coverages provided tend to result in claims
that are characterized as low frequency but high severity. This is
somewhat mitigated by the captive's ability to secure capital from
Chevron in the event of a covered shock loss. Iron Horse directly
benefits from the attention of Chevron's experienced risk management
team. Iron Horse also gains from Chevron's global operations, which
provide favorable geographic spread of risk and line of business
In its role as a captive insurer, Iron Horse, along with Heddington
Insurance Limited, currently provides broad and competitive global
insurance products for Chevron and its subsidiaries. The insurance needs
of Chevron are supplied through these captive operations (where
appropriate) and the commercial market.
Iron Horse and the other Chevron captives provide comprehensive coverage
above Chevron's internal retentions, while Iron Horse's reinsurance is
placed through a corporate wide plan with the world's leading providers
of capacity, resulting in a diversified and balanced distribution of
A.M. Best remains the leading rating agency of alternative risk transfer
entities, with more than 200 such vehicles rated in the United States
and throughout the world.
For current Best's Credit Ratings and independent data on the captive
and alternative risk transfer insurance market, please visit www.ambest.com/captive.
The methodology used in determining these ratings is Best's Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best's rating process and contains the different rating criteria
employed in the rating process. Key criteria utilized include:
"Alternative Risk Transfer"; "Risk Management and the Rating Process for
Insurance Companies"; and "Understanding BCAR for Property/Casualty
Insurers." Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS
A.M. Best Co.
Janet Hernandez, 908-439-2200, ext.
Senior Financial Analyst
DeRose, 908-439-2200, ext. 5453
Morrow, 908-439-2200, ext. 5378
Senior Manager, Public
Peavy, 908-439-2200, ext. 5644
Assistant Vice President,
© Business Wire 2012