Press Release - SEPTEMBER 06, 2019

AM Best Revises Outlooks to Positive for Worldwide Medical Assurance, Ltd. Corp.


CONTACTS:
 Salvador Smith
Financial Analyst
+52 55 1102 2720, ext. 109
salvador.smith@ambest.com

Alfonso Novelo
Senior Director, Analytics
+52 55 1102 2720, ext. 107
alfonso.novelo@ambest.com
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

MEXICO CITY - SEPTEMBER 06, 2019
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb+” of Worldwide Medical Assurance, Ltd. Corp. (WWMA) (Panama City, Panama).

The Credit Ratings (ratings) reflect WWMA’s balance sheet strength, which AM Best categorizes as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The outlook revisions to positive follow sustained balance sheet strength underpinned by risk-adjusted capitalization maintained at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as AM Best’s expectations that WWMA’s profitability will continue to help increase the company’s capital base.

The ratings also reflect WWMA’s sustained strong operating performance supported by sound underwriting practices and a conservative investment strategy, while maintaining its successful gradual expansion into other Latin American markets. These strengths are offset by the company’s dependence on its reinsurance counterparties to implement its growth targets and the highly competitive landscape in Latin America’s health and life insurance segments.

The company began operations in 1999 and has since grown successfully in its niche market, providing insurance for clients traveling overseas to receive medical attention. This is done through a mix of brokers, bancassurance and direct distribution channels. WWMA benefits from its partial ownership by KfW DEG, the German development bank, through its holding company, Worldwide Group, Inc. WWMA’s model of optimizing the selection of medical care providers with support of highly rated reinsurance counterparties also have provided benefits. In recent years, WWMA has expanded operations into other Latin American markets such as Guatemala, Bolivia and Paraguay.

Historically, WWMA has maintained positive capital-creation capacity, which along with a conservative strategy of reinvesting profits, has contributed to its sound risk-adjusted capitalization. Capital management is strengthened further by the use and development of WWMA’s economic capital model, ERM practices and improved diversification among highly rated reinsurers in 2018.

WWMA’s strong underwriting, risk retention and stringent expense practices translate into strong premium sufficiency metrics. Moreover, WWMA’s synergies with its sister company in the Dominican Republic in conjunction with periodic adjustments to its reinsurance structure have helped to optimize the company´s underwriting. These measures, combined with stable financial products, have resulted in sustained profitability indicators, such as return on equity and return on assets, which were 11.1% and 3.6%, respectively, at year-end 2018.

Factors that could lead to positive rating actions include sustained stable operating performance, the continuation in the midterm of its growing capital base supportive of a very strong balance sheet strength and successful consolidation of company operations in targeted locations while maintaining diversification among highly rated reinsurers. Negative rating actions are not expected in the short term, unless significant changes in the company’s strategy damage its income-generating profile or if there is material deterioration of current capital adequacy.

The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of AM Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology .

Key insurance criteria reports utilized:


  • Available Capital & Holding Company Analysis (Version Oct. 13, 2017)

  • Evaluating Country Risk (Version Oct. 13, 2017)

  • Understanding Universal BCAR (Version May 23, 2019)

View a general description of the policies and procedures used to determine credit ratings. For information on the meaning of ratings, structure, voting and the committee process for determining the ratings and monitoring activities, please refer to Understanding Best’s Credit Ratings.


  • Previous Rating Date: Aug. 8, 2018

  • Date Range of Financial Data Used: Dec 31, 2013- June 30, 2019

This press release relates to rating(s) that have been published on AM Best’s website. For additional 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.

AM Best does not validate or certify the information provided by the client in order to issue a credit rating.

While the information obtained from the material source(s) is believed to be reliable, its accuracy is not guaranteed. AM Best does not audit the company’s financial records or statements, or otherwise independently verify the accuracy and reliability of the information; therefore, AM Best cannot attest as to the accuracy of the information provided.

AM Best’s credit ratings are independent and objective opinions, not statements of fact. AM Best is not an Investment Advisor, does not offer investment advice of any kind, nor does the company or its Ratings Analysts offer any form of structuring or financial advice. AM Best’s credit opinions are not recommendations to buy, sell or hold securities, or to make any other investment decisions. View our entire notice for complete details.

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AMB# Company Name
091354 Worldwide Medical Assurance, Ltd. Corp.