The counterparty credit rating on Argonaut Group Inc. reflects the company's diversified business mix, successful execution of its strategy, improving earnings, strong capitalization, conservative financial leverage, and strong fixed-charge coverage. Partially offsetting these positive factors have been the drag on the expense ratio and increased underwriting leverage arising from the company's renewal rights acquisition strategy. Another offset is Argonaut's consolidated underwriting results that, though improving, are not yet as strong as those of some of its competitors. Argonaut's competitive position has become stronger and more diversified. Through acquisitions of renewal rights and insurance subsidiaries, it is now a leading underwriter in several specialty niches. Over the past several years, the company has successfully executed its strategy of focusing on niche
