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A.M. Best Comments on Allied World Assurance Company Holdings, AG and Transatlantic Holdings Inc.’s Merger

A.M. Best Co. has commented that the ratings of the subsidiaries of Allied World Assurance Company Holdings, AG (Allied World) (Switzerland) (NYSE: AWH) as well as Transatlantic Holdings, Inc. (Transatlantic) (New York, NY) (NYSE: TRH) and its subsidiaries are unchanged following the announcement of a definitive agreement to merge. All of the rated operating companies of both organizations maintain financial strength ratings of A (Excellent) and issuer credit ratings of “a”, and all ratings have a stable outlook. (See press releases dated August 24, 2010 and December 21, 2010.)

This transaction brings two complementary organizations together. With Allied World being predominately a primary writer and Transatlantic a pure reinsurer, the merged entity is expected to enjoy an enhanced business profile that will likely inure benefits in the form of an improved competitive position. The merged entity should also benefit from broader distribution channels, broader product diversity and the benefits of a significant global presence. The transaction is expected to be finalized in the fourth quarter of 2011, subject to regulatory approvals.

The ratings of Allied World and Transatlantic will continue to be actively monitored throughout the transaction period, and the ratings of the merged entity will be reviewed once the transaction is completed and A.M. Best has completed its analysis.

The principal methodology used in determining these ratings is Best’s Credit Rating Methodology -- Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best’s rating

process and highlights the different rating criteria employed. Additional key criteria utilized include: “Risk Management and the Rating Process for Insurance Companies”; “Understanding Universal BCAR”; “Natural Catastrophe Stress Test Methodology”; “Rating Members of Insurance Groups”; and “A.M. Best’s Ratings & the Treatment of Debt.” Methodologies can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2011 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

Contacts:

A.M. Best Co.
Greg Reisner, 908-439-2200, ext. 5224

Senior Financial Analyst
greg.reisner@ambest.com
or
Peter Dickey, 908-439-2200, ext. 5053
Assistant Vice President
peter.dickey@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
Senior Manager, Public Relations

rachelle.morrow@ambest.com
or
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations

james.peavy@ambest.com

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