A.M. Best Affirms Ratings of Lancashire Insurance Company and Lancashire Holdings...

A.M. Best Affirms Ratings of Lancashire Insurance Company and Lancashire Holdings Limited

OLDWICK, N.J.--(Business Wire)--
A.M. Best Co. has affirmed the financial strength rating (FSR) of
A- (Excellent) and issuer credit ratings (ICR) of "a-" of Lancashire
Insurance Company (Lancashire) (Hamilton, Bermuda) and Lancashire
Insurance Company (UK) Limited (United Kingdom). Concurrently, A.M.
Best has affirmed the ICR of "bbb-" and debt rating of "bb+" on $132
million subordinated notes, due December 2035 of Lancashire Holdings
Limited. The outlook for all ratings is stable.

These rating actions reflect the group's strong risk adjusted
capitalization, favorable operating results to date and financial
flexibility afforded by its listing on AIM, a subsidiary market of the
London Stock Exchange. Additionally, the ratings reflect the group's
successful execution of its business plan presented to A.M. Best when
the ratings were assigned. Furthermore, the ratings recognize the
systems and controls implemented to monitor and manage the risks to
the organization.

Partially offsetting these positive attributes are the challenges
the group faces due to softening market conditions in its targeted
lines of business. Despite these challenging operating conditions, the
outlook is reflective of the expectation that the group will continue
to produce favorable results and risk-adjusted capitalization will
continue to support the ratings.

For Best's Debt Ratings, all other Best's Ratings, an overview of
the rating process and rating methodologies, please visit
www.ambest.com/ratings.

Founded in 1899, A.M. Best Company is a global full-service credit
rating organization dedicated to serving the financial and health care
service industries, including insurance companies, banks, hospitals
and health care system providers. For more information, visit
www.ambest.com.

A.M. Best Co.
Analysts
Mark Murray, 908-439-2200, ext. 5126
mark.murray@ambest.com
or
Robert DeRose, 908-439-2200, ext. 5453
robert.derose@ambest.com
or
Public Relations
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com

Copyright Business Wire 2008