A.M. Best Co. has affirmed the financial strength rating of “A-” (Excellent) and the issuer credit rating (ICR) of “a-” of Bermuda-based Flagstone Reinsurance Limited. It also assigned an ICR of “bbb-” to Flagstone’s parent, Flagstone Reinsurance Holdings Limited. The outlook for all the ratings is stable.

“The rating affirmations reflect Flagstone’s strong risk-based capitalisation and its successful first year execution of operations within the parameters of the business plan presented to A.M. Best during the initial rating process in 2005,” said the bulletin. “In addition to meeting A.M. Best’s requirements for new company formations, the ratings also reflect Flagstone’s ability to sustain A.M. Best’s stricter risk-based capital requirements for newly formed property catastrophe companies.”

Best’s said that its “initial concerns regarding Flagstone’s establishment of systems and operational controls to underwriting, risk management, claims, investments and financial reporting have been alleviated. The company also has successfully augmented its management and staff with the addition of seasoned personnel through its first year of operations.”