Favorable liquidity and enhanced strategic importance to its parent company are among the reasons A. M. Best highlighted in affirming the ratings of AXA Insurance Co. of New York, N.Y.

The ratings service affirmed the financial strength rating of A- (Excellent) and issuer credit rating of “a-,” noting the outlook for both ratings is stable.

A. M. Best also said the company’s ratings reflect its solid risk-adjusted capitalization, supported by an extensive reinsurance program, and its relationship with its ultimate parent AXA S.A. of France, within the overall AXA group. AXA Insurance Co. serves as AXA group’s primary domestic insurer of reverse flow business, representing the U.S. portion of multinational accounts generated primarily by the clients of AXA Corporate Solutions SA and AXA Versicherung AG.

AXA Insurance Co. also provides 60%  quota share reinsurance coverage for the very profitable portfolio of AXA Art Insurance Corp. of New York, N.Y, an affiliate, to better utilize its capital, A. M. Best said.

Acting essentially in a fronting role, most business is reinsured to AXA Insurance Co.’s affiliates through quota share reinsurance agreements. While heavy reliance on affiliated reinsurance leads to high ceded underwriting leverage, the ratings service noted, the predominant portion of the company’s outstanding reinsurance recoverables is collateralized.

The company also benefits from the financial flexibility of the AXA group. Although operating performance has historically been volatile and at times poor, A.M. Best said it expects this performance to continue improving over the long term based on AXA Insurance Company’s present and clearer strategy, along with its continued reinsurance protection.

A.M. Best also affirmed the financial strength ratings of B++ (Good) and issuer credit rating of “bbb” of AXA’s other U.S. affiliates, Coliseum Reinsurance Co. and its wholly owned subsidiaries, AXA RE Property and Casualty Insurance Co., AXA Corporate Solutions Life Reinsurance, which are in run off, the rating service said.