News 23 Jan, 2012

Standard and Poor's

Standard and Poor’s have advised the Managers that they have lowered the West of England’s public information rating from BBBpi to BBpi.  The Managers believe this action is surprising and unwarranted for the following reasons:-

  • The West of England is not interactively rated by S&P. An unsolicited pi rating is based solely on published information with the result that S&P are relying primarily on published data from the Club’s Report and Accounts dated February 2011 which evidenced stronger financial performance than 12 months earlier. Additional up-to-date data could not be considered due to the nature of a pi rating.

  • AM Best, the Club’s interactive rating agency since 1999, have at their latest rating review, published in December 2011, reaffirmed the Club’s interactive rating as A- (Excellent). This was based on a full interactive analysis of the Club’s most recent data including data not available in the year-end Accounts.

  • The Managers believe that S&P have attached too little weight to the reduction in the Club’s risk profile from the non-renewal of Members with poor records for 2011 and to the consequential reduction in exposure which has resulted in an overall improvement in the Club’s operating performance for the year to date.

  • Claims incurred for all closed policy years have improved since February 2011 and incurred claims for 2011 in particular are at lower levels than for previous policy years at eleven months of development.

  • Insufficient credit has been given to the improving trend in the Club’s overall combined ratio evident over the last 24 months, and which is expected to continue at February 2012.

The Club remains comfortably in excess of all its solvency requirements. No adjustments are necessary to any calls or premiums as set for any of the Club’s open/current policy years.

Should any Member have any questions they should refer to Mark Pender or Peter Spendlove in the usual way.