Bermuda newcomer Ironshore Insurance Ltd. has received its all-important financial strength rating from A.M. Best — a little over a month after opening its doors for business.

The company was set up by Ace and XL co-founder Robert Clements with $1 billion in capital and has set out its stall as an insurer — as opposed to a reinsurer — specialising in property catastrophe coverage in wind-exposed parts of the US.

Yesterday Best announced that it had assigned to Ironshore a financial strength rating of A- (excellent), something that will give clients confidence in the company's ability to pay claims and help Ironshore win business.

Chief executive officer Robert Deutsch told The Royal Gazette yesterday that he was pleasantly surprised at how quickly the rating had arrived.

"They tell you that it typically takes two months or longer, but from the time we met with them, it's only been about a month," Mr. Deutsch said.

"It's much faster than expected and we're thrilled."

Mr. Deutsch said the company had made a solid start since launching at the start of the year.

"We have met with every broker on the Island and we've been very well received," Mr. Deutsch said. "We've received many submissions from a large number of brokers and we're hopeful the Best rating will go a long way towards us receiving more submissions."

A statement from Best, released on Business Wire, said Ironshore's current infrastructure was more than adequate to service present business requirements.

"The assigned ratings reflect Ironshore's solid capitalisation, conservative business plan and an experienced and highly regarded management team," the release stated.

"The company's management team has established a comprehensive operating plan to enhance current systems intended to increase efficiency and service anticipated future growth."

However, Best pointed out that the change in the law in Florida, which involves the state getting involved in the reinsurance and insurance market in an attempt to give homeowners lower insurance rates, could affect Ironshore's business.

Although Ironshore initially aims to target the US Gulf Coast as its main source of business, Best believes that rival start-up insurers seeking alternatives to Florida might provide added competition for the Bermuda company.

"It's hard to speculate on how things will play out in Florida," Mr. Deutsch said.

"I'm not in favour of the legislation. I believe it distorts the marketplace and people end up not paying fair rates for coverage.

"In the event of the 'Big One' hitting, it becomes a taxpayers' subsidy for people with coastal properties."

He added that the extended reach of Florida state-sponsored Citizens Property Insurance Corporation into the market would affect mostly personal lines of business, while the impact on the commercial lines on which Ironshore focuses was difficult to predict.

Best assigned a an issuer credit rating of "a-" to Ironshore and "bbb-" to Ironshore's holding company, Cayman Islands-based Ironshore Inc. The outlook for all ratings is stable.