Beazley Insurance: Understanding Their A.M. Best Rating

When shopping for insurance, it’s important to choose a financially stable provider. One way to evaluate an insurer’s financial strength is to check their A.M. Best rating. This article will examine the A.M. Best ratings for Beazley insurance companies.

What is A.M. Best?

A.M. Best is a global credit rating agency focused on the insurance industry. They analyze the financial strength of insurance companies and assign them letter grades ranging from A++ (Superior) to F (In Liquidation).

These ratings reflect A.M. Best’s opinion of an insurer’s ability to pay out future claims. They are not a guarantee, but can provide insight into a company’s financial stability.

Beazley Group Overview

The Beazley Group includes various underwriting divisions offering specialized insurance products worldwide. Areas of focus include marine, property, cyber liability, political risks, accident & health, and more.

Beazley is headquartered in London and has operations across Europe, the US, Canada, Latin America and Asia. They underwrite business through Lloyd’s of London syndicates and also have admitted carriers in the US.

Some of their key insurance companies include:

• Beazley Insurance Company, Inc.
• Beazley Insurance Services
• Beazley Syndicates AFB and 623 at Lloyd’s
• Beazley Excess and Surplus Insurance Company

Beazley’s A.M. Best Ratings

Here are the latest A.M. Best ratings for Beazley’s core insurance entities:

Beazley Insurance Company, Inc.

• Financial Strength Rating: A (Excellent)

• Long-Term Issuer Credit Rating: a (Excellent)

Beazley Insurance Services

• Financial Strength Rating: A (Excellent)

• Long-Term Issuer Credit Rating: a (Excellent)

Beazley Syndicates AFB and 623 at Lloyd’s

• Financial Strength Rating: A (Excellent)

• Long-Term Issuer Credit Rating: a (Excellent)

Beazley Excess and Surplus Insurance Company

• Financial Strength Rating: A (Excellent)

• Long-Term Issuer Credit Rating: a (Excellent)

What Do These Ratings Mean?

Beazley’s “A” (Excellent) ratings from A.M. Best reflect their strong ability to pay out future claims. Here is what each of the main ratings indicate:

A.M. Best Financial Strength Rating (FSR)

This assesses an insurer’s financial strength and ability to meet ongoing insurance obligations. The ratings scale is:

• A++, A+ (Superior)
• A, A- (Excellent)
• B++, B+ (Good)
• B, B- (Fair)
• C++, C+ (Marginal)
• C, C- (Weak)
• D (Poor)
• E (Under Regulatory Supervision)
• F (In Liquidation)

Beazley’s “A” (Excellent) rating indicates a superior ability to meet claims payments and endure financial market changes.

A.M. Best Issuer Credit Rating (ICR)

This evaluates an insurer’s ability to meet senior financial obligations and debt. The scale is:

• aaa (Exceptional)
• aa (Superior)
• a (Excellent)
• bbb (Good)
• bb (Marginal)
• b (Weak)
• ccc, cc, c (Very Weak)
• d (In Default)

Beazley’s “a” (Excellent) Issuer Credit Rating reflects excellent financial security characteristics.

Rating Outlooks

In addition to the letter ratings, A.M. Best also assigns outlooks to indicate potential direction of future ratings. Positive, negative, and stable outlooks reflect if ratings are likely to be upgraded, downgraded, or remain unchanged within 12-36 months.

As of February 2023, Beazley companies have been assigned a “Stable” outlook, indicating ratings are likely to remain unchanged based on current balancesheet strength and operating performance.

Rating Impact on Insurance Costs

A.M. Best ratings generally have no direct impact on what consumers pay for insurance. However, a strong rating indicates an insurer’s ability to offer stable, competitively priced insurance.

Policyholders may ultimately benefit from A-rated carriers having lower costs of capital and reduced risk of insolvency. But many factors influence insurance pricing beyond just financial strength.

Rating Limitations

While independent and objective, A.M. Best ratings have some limitations to be aware of:

• They are an opinion, not a guarantee of future financial stability.

• Ratings are relative compared to other insurers, not an absolute measure.

• Complex models are used with some subjectivity in analysis.

• Timing lags may delay response to sudden impacts.

• All insurers are still exposed to unforeseen risks.

So A.M. Best ratings provide a helpful benchmark for comparison, but should not be the only factor in choosing an insurance provider.

The Bottom Line

With A.M. Best ratings of A (Excellent), Beazley insurance companies demonstrate superior financial strength and claims-paying ability. These positive ratings reflect their strong capitalization, prudent operating strategy, and underwriting expertise.

While not a guarantee of future success, Beazley’s excellent ratings give policyholders added confidence in their long-term financial stability. Consider A.M. Best analysis along with other factors when evaluating insurance providers.