A.M. Best Withdraws Credit Ratings of ANA Compañía de Seguros S.A. de C.V.

A.M. Best has affirmed the Financial Strength Rating of B- (Fair), the Long-Term Issuer Credit Rating of “bb-” and the Mexico National Scale Rating of “a-.MX” of ANA Compañía de Seguros S.A. de C.V. (ANA) (Mexico). The outlook of these Credit Ratings (ratings) is revised to stable from positive. Concurrently, A.M. Best has withdrawn the ratings as the company has requested to no longer participate in A.M. Best’s interactive rating process.

The change in outlook to stable reflects the company’s 2017 risk-adjusted capitalization standing at weak levels as it has experienced pressure derived from above-market premiums growth and a reduction in reported equity. ANA may improve capital adequacy levels in the medium term given that it has benefited historically from the support of its immediate parent, GMS Valore, S.A. de C.V. (formerly Grupo Maxasem) (GMS Valore) in the form of previous capital injections, as well as synergies with other group members.

The ratings reflect ANA’s balance sheet strength, which A.M. Best categorizes as adequate, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

The ratings also recognize the company’s improvement in operating performance and ANA’s affiliation with GMS Valore, which affords ANA operating efficiencies as a member of this group. Offsetting these positive rating factors is the company’s risk-adjusted capitalization standing at weak levels, as measured by Best’s Capital Adequacy Ratio (BCAR), ANA’s relatively small size within the industry’s highly competitive environment and its concentration in a single business line.

ANA was established in Mexico in 1995 and acquired by GMS Valore in 2002. The company exclusively underwrites auto insurance. ANA operates through a network of local agents, auto dealers and service offices throughout Mexico.

ANA has continued to strengthen its underwriting policies, which has resulted in premium sufficiency indicators since 2016. During 2017, improvement in operating performance was driven by premium growth in line with improved underwriting practices, a contained evolution of claims and enhanced investment results, thus generating stronger bottom-line results. ANA posted a 95.7% combined ratio and return on equity of 19.5% in 2017.

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. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

Key insurance criteria reports utilized:

• A.M. Best’s Ratings On a National Scale (Version Oct. 13, 2017)
• Available Capital and Holding Company Analysis (Version Oct. 13, 2017)
• Catastrophe Analysis in A.M. Best Ratings (Version Oct. 13, 2017)
• Evaluating Country Risk (Version Oct. 13, 2017)
• Understanding Universal BCAR (Version Oct. 13, 2017)

View a general description of the policies and procedures used to determine credit ratings. For information on the meaning of ratings, structure, voting and the committee process for determining the ratings and monitoring activities, please refer to Understanding Best’s Credit Ratings.

• Previous Rating Date: Feb. 24, 2017
• Date of Financial Data Used: Dec. 31, 2017

This press release relates to rating(s) that have been published on A.M. Best's website. For additional rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page.

A.M. Best does not validate or certify the information provided by the client in order to issue a credit rating.

While the information obtained from the material source(s) is believed to be reliable, its accuracy is not guaranteed. A.M. Best does not audit the company’s financial records or statements, or otherwise independently verify the accuracy and reliability of the information; therefore, A.M. Best cannot attest as to the accuracy of the information provided.

A.M. Best’s credit ratings are independent and objective opinions, not statements of fact. A.M. Best is not an Investment Advisor, does not offer investment advice of any kind, nor does the company or its Ratings Analysts offer any form of structuring or financial advice. A.M. Best’s credit opinions are not recommendations to buy, sell or hold securities, or to make any other investment decisions. View our entire notice for complete details.

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