Standard & Poor's said its ratings affirmation was based on the guarantee from AXA France IARD that it will cover new business written by AXA Re until at least March 31, 2007, and possibly for a year after that.

S&P London-based credit analyst Simon Marshall said the guarantee will be effective for policies issued by AXA Re that are in force on the termination date, but would not be effective for policies issued by Paris Re, a subsidiary of Paris Re Holdings.

Paris Re Holdings Ltd. is a newly created company funded by a consortium of international investors led by Stone Point Capital LLC, in which AXA would take a participation of less than 10 percent. The S&P outlook on AXA Re is positive.

A.M. Best, Oldwick, N.J., said the fact that Paris Re is likely to be capitalized at the same level as AXA Re and will also benefit from a guarantee provided by AXA Re's parent pertaining to claims incurred before December 31, 2005 led to its maintenance of its A rating.

According to the 2005 AXA annual statement, AXA Re's underlying earnings were down 89 percent last year to $13 million from $116 million in 2004. Major losses recorded last year represented 49.6 points of the loss ratio versus 25.1 points in 2004.