OREANDA-NEWS. June 25, 2012. A.M. Best Europe has assigned a financial strength rating of B++ and an issuer credit rating of “bbb” to OJSC SOGAZ. The outlook assigned to both ratings is stable. SOGAZ has become Russia’s only all-purpose insurer rated by A.M. Best.

According to an official statement of the rating agency, “The ratings reflect SOGAZ’s strong competitive position as a commercial property insurer, good consolidated, albeit potentially volatile, risk-adjusted capitalization and good technical performance”.

A. M. Best believes that SOGAZ benefits from strong competitive position across its underwriting portfolio, particularly in relation to the property account, where it maintains a significant market share. In this context, the agency notes that SOGAZ focuses on industrial, energy and other commercial business, which represents approximately 50% of its gross written premiums. The company’s market profile is supported by its widespread regional network and long-term relationships with major Russian corporations.

The agency also notes that SOGAZ’s technical results remain good, as demonstrated by a five-year average combined ratio of 91%. With the exception of voluntary medical insurance, accounting for approximately 30% of consolidated GWP, performance typically has been supported by profits from most classes of business.

According to A.M. Best’s forecasts, in 2012, a further improvement in the company’s combined ratio is expected, partly due to the corrective actions taken to reduce losses arising from, among other things, the weather-related events of 2010.

“Such a high rating, which, in the context of ratings assigned by various rating agencies, we believe to be the highest in the Russian insurance market, will undoubtedly be acclaimed by SOGAZ’s clients and partners in Russia and abroad. We believe that an opinion of such a reputable rating agency specializing in insurance company assessments is the most accurate reflection of the real situation in the insurance market”, says Sergey Ivanov, Chairman of SOGAZ’s Management Board. “The company has not only the necessary financial strength reserve, but also a great potential for participation in major international projects, both directly and through reinsurance instruments. I would also like to note that SOGAZ is currently Russia’s only all-purpose insurer rated by A.M. Best”.

SOGAZ has also received international financial strength ratings from Standard & Poor's (“BBB-”, outlook “Stable”) and Fitch Ratings (“BB+”, outlook “Stable”).