AM Best Assigns Credit Ratings to Motors Insurance Company Limited

AM Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” to Motors Insurance Company Limited (MICL) (United Kingdom). The outlook assigned to these Credit Ratings (ratings) is stable.

The ratings reflect MICL’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

MICL’s balance sheet strength is underpinned by its risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), prudent reserving practices, demonstrated by a track record of favourable reserve development, and a high-quality investment portfolio. AM Best expects MICL’s prospective risk-adjusted capitalisation to remain at the strongest level, supported by good internal capital generation. An offsetting factor in the balance sheet strength assessment is the company’s high dependence on reinsurance and concentration to one reinsurance counterparty. However, the risks associated with this is mitigated partly by its reinsurers’ excellent credit quality.

MICL has a track record of strong operating performance, demonstrated by a five-year weighted average (2015-2019) return-on-equity ratio of 11.8%. Earnings are underpinned by its stable underwriting performance, demonstrated by a loss ratio that has remained between 51.2% and 56.6% over the past five years. Overall earnings are driven by its underwriting result, with investment income accounting for a relatively small component.

MICL provides motor warranty and ancillary motor policies, primarily distributed by retail intermediaries. The company has a well-established competitive position in the motor warranty market in the United Kingdom, which generates the majority of its premiums, supported by smaller positions in other European countries, as well as Brazil, Turkey and China. Whilst MICL see opportunities to grow cautiously outside of the United Kingdom, AM Best expects the company’s profile to remain limited.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


Marving Lopez
Associate Financial Analyst
+44 20 7397 4389

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