OLDWICK, N.J.--(BUSINESS WIRE)--
A.M. Best Co. has affirmed the financial strength rating of A-
(Excellent) and issuer credit rating of "a-" of Eastern Re Ltd. S.P.C.
(Eastern Re) (Grand Cayman, Cayman Islands). The outlook for both
ratings is stable.
These ratings recognize Eastern Re's strategic affiliation with Eastern
Alliance Insurance Group (EAIG), its historically profitable
operating results as well as its sound stand-alone capitalization. These
positive rating factors are partially offset by Eastern Re's exclusive
reliance on EAIG for production of all of its business as well as the
mono-line orientation of Eastern Re, which primarily acts as a workers'
compensation reinsurer.
Eastern Re is a segregated portfolio company, or cell captive, whose
general cell is an indirect wholly owned subsidiary of Eastern
Insurance Holdings, Inc. (EIHI) [NASDAQ: EIHI], a Pennsylvania
holding company, which also indirectly owns Eastern Alliance Insurance
Company, Allied Eastern Indemnity Company and Eastern
Advantage Assurance Company. These companies are
Pennsylvania-domiciled workers' compensation insurance companies, which
produce business through regional agents. These companies, which are the
non-life risk-bearing entities of EAIG, provide both fronting
capabilities and reinsurance protection to Eastern Re. Additionally,
Eastern Re utilizes the expertise of Employers Alliance Inc., a
Pennsylvania-domiciled insurance services provider that acts as a
third-party administrator and provides services for all of the cells of
Eastern Re.
Eastern Re issues preferred shares to 15 cell owners, which are agent or
group captives that purchase workers' compensation coverage from EAIG.
These agent and group captives participate in the profits and losses of
the cell for which they are the owners. This dynamic provides added
incentive to the agent or group captive to prevent adverse selection for
the business being assumed by Eastern Re.
A.M. Best remains the leading rating agency of captive insurers rating a
wide variety of more than 200 captives in the United States and
throughout the world.
For current Best's Ratings and independent data on the captive and
alternative insurance market, please visit www.ambest.com/captive.
The principal methodologies used in determining these ratings, including
any additional methodologies and factors, which may have been
considered, can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is a global full-service credit
rating organization dedicated to serving the financial and health care
service industries, including insurance companies, banks, hospitals and
health care system providers. For more information, visit www.ambest.com.
Source: A.M. Best Co.
Contact: A.M. Best Co.
Analysts:
Gale Guerra, 908-439-2200, ext. 5069
gale.guerra@ambest.com
or
Steven Chirico, CPA, 908-439-2200, ext. 5087
steven.chirico@ambest.com
or
Public Relations:
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com