A.M. Best Co. has upgraded the financial strength ratings (FSR) to A+ (Superior) from A (Excellent) and the issuer credit ratings (ICR) to “aa-” from “a+” of Arch Reinsurance Ltd. (Arch) (Bermuda), its strategic affiliates and its separately rated affiliate, Arch Specialty Insurance Company (Omaha, NE). A.M. Best also has upgraded the ICR to “bbb+” from “bbb” of Arch Capital Group (US) Inc. (New York, NY). Concurrently, A.M. Best has upgraded the ICR to “a-” from “bbb+” as well as all debt ratings of the ultimate holding company, Arch Capital Group Ltd (Bermuda) (NASDAQ: ACGL). The outlook for all ratings has been revised to stable from positive. (See below for a detailed listing of the companies and ratings.) The upgrades reflect Arch’s continued superior operating performance amidst challenging market conditions, consistently excellent capitalization and demonstrated risk management ability. Arch maintains a very strong underwriting culture, which centers on active cycle management and adaptability to varied market conditions. In a market environment where investment yields are hovering at record lows, underwriting profitability needs to be paramount. The company is positioned to write a broad range of property/casualty insurance and reinsurance on a worldwide basis with an emphasis on specialty lines. Overall operating results since Arch’s inception have been strong and in certain instances have exceeded most peers in the sector. Typically, Arch has had a smaller share of major industry losses, with 2011 reported losses being no exception, which is demonstrative of the company’s superior risk management. As a result, Arch has reported stable and consistent financial results with lower levels of volatility than many of its peers. Furthermore, Arch has a prudent investment portfolio and conservative reserving philosophy, which helps maintain a strong balance sheet. Partially offsetting these positive rating attributes are the current soft market conditions through which Arch, as well as all industry participants, must navigate.