Following a review of Germany-Based Wuerttembergische Gemeinde-Versicherung aG (WGV aG) and its core subsidiary WGV – Versicherung AG (WGV aG) under our revised insurance criteria, we are affirming our public information ‘Api’ ratings on the companies.
The ratings on WGV aG reflect our view of the company’s satisfactory business risk profile and strong financial risk profile.
The ratings on WGV AG reflect the subsidiary’s core status to its parent, WGV aG.
Standard & Poor’s Ratings Services’ said today that it has affirmed its unsolicited public information (pi) insurer financial strength and counterparty credit ratings on Germany-based property casualty (P/C) insurer Wuerttembergische Gemeinde-Versicherung aG (WGV aG) and its core subsidiary WGV – Versicherung AG (WGV AG) at ‘Api’.
The ratings predominantly reflect our view of WGV aG’s satisfactory business risk profile and strong financial risk profile. We base our assessment of WGV aG’s business risk profile on our opinion of its low industry and country risk and adequate competitive position. As regards its financial risk profile, we factor in our view of its strong capital and earnings, intermediate risk position, and adequate financial flexibility. We combine these factors to derive an ‘a-‘ anchor for WGV aG. The ratings are ‘Api’, as our public information ratings generally do not bear plus or minus modifiers.
The ratings on WGV AG reflect our view of the company’s core status to its parent WGV aG, under our criteria. The core status reflects WGV AG’s importance to the WGV Group, contributing about 45% in premiums written. We view WGV AG as an integral part of the group’s strategy, as it represents a well-established expansion from the group’s roots as a Wuerttemberg-focused public sector business. WGV AG, in line with its parent, writes mainly primary P/C insurance, with the main line of business being motor (2012: 63%).
WGV aG is a German P/C mutual insurer and the parent of the midsize WGV Group, which includes WGV AG and WGV-Lebensversicherung AG (not rated). The WGV group generated €561.5 million gross premiums written (GPW) in 2012–split 92% P/C and 8% life business–after €521.0 million in 2011. WGV aG focuses on providing P/C insurance protection to towns, local governments, public law bodies, and individuals employed in the public sector in the Wuerttemberg area. Meanwhile, WGV AG offers P/C insurance on a direct basis, predominantly motor insurance to private customers outside of Wuerttemberg.
