Press Release - JANUARY 31, 2019

AM Best Downgrades Credit Ratings of QBE Seguros; Places Credit Ratings Under Review With Negative Implications


CONTACTS:
 Dan Teclaw
Senior Financial Analyst
+1 908 439 2200, ext. 5394
dan.teclaw@ambest.com

Daniel J. Ryan
Senior Director
+1 908 439 2200, ext. 5325
daniel.ryan@ambest.com
Christopher Sharkey
Manager, Public Relations
(908) 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
(908) 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - JANUARY 31, 2019
AM Best has downgraded the Financial Strength Rating to B++ (Good) from A- (Excellent) and the Long-Term Issuer Credit Rating to “bbb” from “a-” for QBE Seguros (San Juan, PR). Concurrently, AM Best has placed the Credit Ratings (ratings) under review with negative implications.

These rating actions follow QBE Insurance Group Limited’s (QBE) recent announcement that it has entered into an agreement to sell its wholly owned subsidiary, QBE Seguros, to Rincon Investment, Inc., a private investor group.

The rating downgrades reflect AM Best’s removal of ratings lift (enhancement) based on QBE’s divestiture, and the prospective elimination of any explicit and implicit support to be provided from QBE and its affiliates post-divestiture. This includes the extensive reinsurance support historically provided by its affiliate, Equator Reinsurances Limited, the organizational support historically received from QBE and its affiliates, as well as any future capital and/or other financial support measures.

The ratings of QBE Seguros are therefore solely based on the company’s stand-alone attributes, which reflect the company’s balance sheet strength, which AM Best categorizes as adequate, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

The under review status reflects residual uncertainty regarding the company’s balance sheet strength, prospective operations, business profile and ERM. The negative implications reflect the uncertainty and potential difficulties in no longer having QBE, one of the leading global insurers, as a resource. AM Best expects the ratings to remain under review through closing and will monitor any interim developments as it progresses leading up to the sale.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global rating agency and information provider with a unique focus on the insurance industry.


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AMB# Company Name
085434 QBE Insurance Group Limited
013088 QBE Seguros