UK insurers to withstand flood losses

A new briefing from A.M. Best states that it does not expect an increase in rating downgrades, according to a briefing.

The briefing states that while current estimates set the insured losses at between GBP 750 million and GBP 1.2 billion, A.M. Best expects insurers to withstand these losses, with little effect on ratings, given the overall soundness of their business and capital strength.

Stefan Holzberger, managing director, analytics and author of the briefing said, "Despite the marginal returns expected for 2013, A.M. Best does not expect an increase in rating downgrades for two reasons: Many UK insurers have international business that performed well in 2013, given generally adequate rates and relatively few major catastrophes; and second, insurers have strengthened their balance sheets over the past few years and currently maintain sound capital buffers that exceed requirements for their current rating levels".