Moody's affirms Allied World; outlook down to negative

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

In the same action, Moody's said it changed the outlook to negative from stable.

This rating action follows Allied World's announcement that it has entered into a definitive agreement to acquire Darwin Professional Underwriters Inc. for $550 million, the agency said.

The acquisition is subject to various regulatory and shareholder approvals and is expected to close in the fourth quarter of 2008, the agency added.

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

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