Moody's affirms Allied World

Moody's Investors Service said it affirmed its Baa1 senior debt rating on Allied World Assurance Co. Holdings, Ltd.'s and the A2 insurance financial strength ratings on its insurance subsidiaries.

The outlook remains stable.

The agency said that this rating action follows Allied World's announcement that it has entered into an agreement to repurchase 19.4% of its outstanding shares currently held by one of its original founding members.

According to Moody's, Allied World's ratings reflect its market position as a specialty niche provider of property and casualty insurance and reinsurance, its low underwriting and financial leverage targets following its July 2006 initial public offering and a high-quality investment portfolio.

These core strengths are tempered by the company's limited operating history relative to a full underwriting cycle in the highly cyclical specialty insurance and reinsurance sectors and by the inherent underwriting volatility in many of these specialty lines, which include catastrophe-exposed property risks and complex casualty-based exposures including directors' and officers' liability, the agency said.

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