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   LONDON--(Business Wire)--A.M. Best Europe - Rating Services Limited has affirmed the financial strengthrating of B+ (Good) and issuer credit rating of "bbb-" of Socit Tunisienne deRassurance (Tunis Re)(Tunisia). The outlook for both ratings remains stable. The ratings of Tunis Re reflect its increasing risk-adjusted capitalisation andgood resilience in the context of the unrest in Tunisia. Offsetting ratingfactors relate to the company`s profile limited to the Tunisian market and therelatively high level of the economic and financial systemic risk. Additionally,Tunis Re`s underwriting performance decreased in 2011 due to the adverse marketconditions. In A.M. Best`s view, Tunis Re`s risk-adjusted capitalisation, as measured byBest`s Capital Adequacy Ratio (BCAR), is expected to improve going forward dueto a recent capital injection. Tunis Re increased its overall capital by TND 60million (USD 40 million-equally distributed between fresh capital and premiumissue), which was successfully completed in May 2012. A.M. Best notes that Tunis Re responded promptly with new strategic actions tothe critical political situation affecting Tunisia and Arabic countries during2011. Despite the economic situation, the company has been able to renew all2010 reinsurance treaties and created a federation with all domestic insurers inorder to review policy rates and to guarantee a coherent pricing within theTunisian insurance market. Tunis Re`s business profile as well as its investment portfolio is limited tothe Tunisian market, a country that A.M. Best considers to have a relativelyhigh level of economic and financial systemic risk. At the beginning of 2011Tunisia was shocked by a political unrest, but with the elections held inOctober 2011, an interim government was designated and the situation istemporarily settled. Nevertheless, the political situation remains uncertain,and the new government has to demonstrate its capability to support the economicrecovery until the parliamentary elections that are set to be held between Marchand June 2013. For 2011, the company reported a decrease in its overall profitability. Theprofits-before-tax in 2010 were TND 5.4 million (USD 3.8 million), though for2011 the result decreased by 50% due to the increase in net claims incurredduring the political movement. Tunis Re`s overall business, in terms of grosswritten premiums, decreased by 4.3%, especially in the aviation and engineeringlines of business. Key factors that could trigger negative rating actions include a downward trendin underwriting performance, deterioration in risk-adjusted capitalisation andthe credit quality of investments. An aggravation of the political situationalso could have a negative impact on Tunis Re`s ratings. Rating upgrades are unlikely at this time. The methodology used in determining these ratings is Best`s Credit RatingMethodology, which provides a comprehensive explanation of A.M. Best`s ratingprocess and contains the different rating criteria employed in the ratingprocess. Key criteria utilised include: "Risk Management and the Rating Processfor Insurance Companies"; "Understanding Universal BCAR"; "Catastrophe Analysisin A.M. Best Ratings"; and "Assessing Country Risk." Best`s Credit RatingMethodology can be found at 
  www.ambest.com/ratings/methodology.
 In accordance with Regulation (EC) No. 1060/2009, the following is a link torequired disclosures: A.M. Best Europe - Rating Services Limited SupplementaryDisclosure.A.M. Best Europe - Rating Services Limited is a subsidiary of A.M. BestCompany.Founded in 1899, A.M. Best Company is the world's oldest and mostauthoritative insurance rating and information source. For more information,visit 
  www.ambest.com.
 Copyright  2012 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.  A.M. Best Europe - Rating Services LimitedArianna BrinaAssociate Financial Analyst+(44) 207 397 0330arianna.brina@ambest.comorAnandi Nangy-KotechaAssociate Director+(44) 207 397 0271anandi.nangy-kotecha@ambest.comorRachelle MorrowSenior Manager, Public Relations+(1) 908 439 2200, ext. 5378rachelle.morrow@ambest.comorJim PeavyAssistant Vice President, Public Relations+(1) 908 439 2200, ext. 5644james.peavy@ambest.comCopyright Business Wire 2012