TM HF. Icelandic Non-Life Insurer Tryggingamidstodin 'BBB' Ratings Affirmed, Then Withdrawn At The Company's Request
Primary Credit Analyst:Anna Glennmar, Stockholm (46) 8-440-5922; anna.glennmar@spglobal.com
Secondary Credit Analyst:Alexander Altinisik, Stockholm (46) 8-440-5902; alexander.altinisik@standardandpoors.com
Table Of Contents
Overview Rating Action Rationale
Related Criteria And Research Ratings List
Research Update:Icelandic Non-Life Insurer Tryggingamidstodin 'BBB' Ratings Affirmed, Then Withdrawn At The Company's Request
Overview
We are affirming our 'BBB' ratings on Icelandic non-life insurer Tryggingamidstodin hf. (TM).
We are subsequently withdrawing our ratings at TM's request.
At the time of withdrawal, the outlook was stable.
Rating Action
On May 3, 2016, S&P Global Ratings affirmed its 'BBB' long-term insurer financial strength and counterparty credit ratings on Icelandic non-life insurer Tryggingamidstodin hf (TM).
We subsequently withdrew all ratings at TM's request. At the time of withdrawal, the outlook was stable.
Rationale
The affirmation reflected our view that TM has a fair business risk profile, with a market share in the Icelandic non-life insurance markets of approximately 25% and good operating performance, reflected in an average combined (loss and expense) ratio of 96% over 2011-2015. The combined ratio is the industry's leading underwriting profitability metric. The lower the combined ratio, the more profitable the insurer, and a ratio of more than 100% signifies an underwriting loss. TM reported weaker operating performance in 2015 than 2014, with a combined ratio of 103.3%, due to high weather-related claims in the first half of the year after several storms in Iceland. However, we believed that the group's conscious policy of writing profitable business and reducing costs, together with an easing in price competition, will result in improved earnings, with combined ratios of about 95% by year-end 2018. We considered that TM's limited geographic diversity beyond Iceland exposed it to moderate insurance industry and country risk, which constrained our view of TM's business risk profile.
The affirmation also reflected our view of TM's upper adequate financial risk profile with moderately strong capital and earnings and an increasingly shareholder focused capital management strategy. Moreover, in our view, the small absolute size of TM's capital--shareholder's equity of Icelandic krona 12 billion (about $93 million) in 2015--made the company vulnerable to losses from single events. Another constraint was TM's underwriting and investment concentrations in Iceland, which exposed the company to further potential volatility in its capital base.
Research Update: Icelandic Non-Life Insurer Tryggingamidstodin 'BBB' Ratings Affirmed, Then Withdrawn At The
Company's Request
The outlook at the time of withdrawal was stable, which reflected our expectation that TM's management would continue to successfully implement its strategy, sustain the company's moderately strong capital and earnings, and preserve its investment risk profile over the next two years. We also expected TM's underwriting earnings to recover to levels commensurate with its competitive position.
Related Criteria And Research
Related Criteria
General Criteria: Group Rating Methodology - November 19, 2013
General Criteria: Ratings Above The Sovereign--Corporate And Government Ratings: Methodology And Assumptions - November 19, 2013
Criteria - Insurance - General: Enterprise Risk Management - May 07, 2013
Criteria - Insurance - General: Insurers: Rating Methodology - May 07, 2013
General Criteria: Methodology: Management And Governance Credit Factors For Corporate Entities And Insurers - November 13, 2012
Criteria - Insurance - General: Refined Methodology And Assumptions For Analyzing Insurer Capital Adequacy Using The Risk-Based Insurance Capital Model - June 07, 2010
General Criteria: Use Of CreditWatch And Outlooks - September 14, 2009
Ratings List
Ratings Affirmed
Rating
To From
Tryggingamidstodin hf. Counterparty Credit Rating
Local Currency BBB/Stable/-- BBB/Stable/-- Financial Strength Rating
Local Currency BBB/Stable/-- BBB/Stable/-- Ratings Subsequently Withdrawn
Tryggingamidstodin hf. Counterparty Credit Rating
Local Currency NR BBB/Stable/-- Financial Strength Rating
Local Currency NR BBB/Stable/--
Research Update: Icelandic Non-Life Insurer Tryggingamidstodin 'BBB' Ratings Affirmed, Then Withdrawn At The
Company's Request
NR--Not rated
Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please seeRatings Criteria at www.standardandpoors.com for further information. Complete ratings information is available to subscribers of RatingsDirect atwww.globalcreditportal.com and at spcapitaliq.com. All ratings affected by this rating action can be found on S&P Global Ratings' public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.
Alternatively, call one of the following S&P Global Ratings numbers: Client Support Europe (44) 20-7176-7176; London Press Office (44) 20-7176-3605; Paris (33) 1-4420-
6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-440-5914; or Moscow 7 (495)
783-4009.
Additional Contact:Insurance Ratings Europe; InsuranceInteractive_Europe@standardandpoors.com
Copyright © 2016 by Standard & Poor's Financial Services LLC. All rights reserved.
No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P). The Content shall not be used for any unlawful or unauthorized purposes. S&P and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively S&P Parties) do not guarantee the accuracy, completeness, timeliness or availability of the Content. S&P Parties are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, for the results obtained from the use of the Content, or for the security or maintenance of any data input by the user. The Content is provided on an "as is" basis. S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE CONTENT'S FUNCTIONING WILL BE UNINTERRUPTED, OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION. In no
event shall S&P Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Content even if advised of the possibility of such damages.
Credit-related and other analyses, including ratings, and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact. S&P's opinions, analyses, and rating acknowledgment decisions (described below) are not recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security. S&P assumes no obligation to update the Content following publication in any form or format. The Content should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. S&P does not act as a fiduciary or an investment advisor except where registered as such. While S&P has obtained information from sources it believes to be reliable, S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives.
To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes, S&P reserves the right to assign, withdraw, or suspend such acknowledgement at any time and in its sole discretion. S&P Parties disclaim any duty whatsoever arising out of the assignment, withdrawal, or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof.
S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of S&P may have information that is not available to other S&P business units. S&P has established policies and procedures to maintain the confidentiality of certain nonpublic information received in connection with each analytical process.
S&P may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P reserves the right to disseminate its opinions and analyses. S&P's public ratings and analyses are made available on its Web sites,www.standardandpoors.com (free of charge), andwww.ratingsdirect.com andwww.globalcreditportal.com (subscription) andwww.spcapitaliq.com (subscription) and may be distributed through other means, including via S&P publications and third-party redistributors. Additional information about our ratings fees is available atwww.standardandpoors.com/usratingsfees.
STANDARD & POOR'S, S&P and RATINGSDIRECT are registered trademarks of Standard & Poor's Financial Services LLC.
Tryggingamiðstöðin hf. published this content on 03 May 2016 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 04 May 2016 07:48:04 UTC.
Public permalinkhttp://www.publicnow.com/view/B62502A72C9B9D84FF7CD959F4EF347A2EC212E8
