A.M. Best Affirms Ratings Iron Horse Insurance Company

The ratings reflect Iron Horse's superior risk-adjusted capitalization, experienced management team and the role that the company serves as a captive insurance company for Chevron Corporation (NYSE: CVX).

These positive rating factors are partially offset by the company's high net loss exposures as the coverages provided tend to result in claims that are characterized as low frequency but high severity. This is somewhat mitigated by Iron Horse's ability to secure capital from Chevron in the event of a covered shock loss. Iron Horse directly benefits from the attention of Chevron's experienced risk management team and also gains from its global operations, which provide favorable geographic spread of risk and line of business diversification.

In its role as a captive insurer, Iron Horse provides broad and competitive global insurance products for Chevron and its subsidiaries. Structurally, Iron Horse is a direct subsidiary of Chevron. Chevron owns four other active captives: Traders Insurance Ltd., which merged with Bermaco Insurance Company Ltd. in December 2006, Heddington Insurance Limited, Heddington Insurance (U.K.) Limited and Puritan Assurance Ltd. A portion of the insurance needs of Chevron are supplied through these captive operations, where appropriate, and the commercial market, with many of the insurance arrangements rationalized among captives to enhance operating efficiencies. Iron Horse, along with other Chevron captives, provides comprehensive coverage above Chevron's internal retentions, while its reinsurance is placed through a corporate-wide plan with the world's significant providers of capacity, resulting in a diversified and balanced distribution of reinsurers.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.

A.M. Best Co.
Analysts:
Nick Dranchak, 908-439-2200, ext. 5629
nick.dranchak@ambest.com
or
Steven Chirico, CPA, 908-439-2200, ext. 5087
steven.chirico@ambest.com
or
Public Relations:
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com