Press Release - MARCH 20, 2020

AM Best Affirms Credit Ratings of ASSA Compañía de Seguros S.A.

 Salvador Smith
Analista Financiero
+52 55 1102 2720, int. 109

Alfonso Novelo
Director Senior de Análisis
+52 55 1102 2720, int. 107
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644


AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” of ASSA Compañía de Seguros S.A. (ASSA) (Panama City, Panama). The outlook of these Credit Ratings (ratings) is stable. ASSA is a subsidiary of ASSA Compañía Tenedora S.A. (ASSA Tenedora) and is owned ultimately by Grupo ASSA, S.A. (Grupo ASSA), a financial services holding company publicly traded on the Panama Stock Exchange.

The ratings of ASSA reflect its balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, favorable business profile and appropriate enterprise risk management .

ASSA is a Panama-based insurer established in 1980 and ranks as the largest insurance company in Panama in terms of premium market share. The company, which has a subsidiary in El Salvador, is geographically diversified in the Central American market and has a diversified portfolio of products with net premiums written mainly composed of auto, individual and group life and health. ASSA operates through a network of brokers, agents and direct distribution channels throughout the region.

The ratings reflect ASSA’s balance sheet strength, which is underpinned by its risk-adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), sustained underwriting quality and profitability, good capital management, adequate reinsurance program and supporting risk management framework for its risk profile. Additionally, the company has been able to maintain an adequate financial leverage by repaying most of the financing used in the 2018 transaction.

The company´s capital base, consistently grown through reinvestment of earnings, has maintained ASSA’s risk-adjusted capitalization at the strongest level, despite intangibles of Generali’s acquired business that continue to be amortized. A more-diversified reinsurance program placed among reinsurers with good security levels has reinforced the company’s inorganic growth strategy, and consequently, counterparty credit risk exposures have been minimized.

In 2019, ASSA’s operating performance was characterized by a combined ratio below 100%. These results were supported by continued strong performance in its auto, group life, and property/casualty businesses, which constitute more than 56% of net premiums. Financial income continues to support ASSA’s results while it maintains a sound risk profile; however, the company is not dependent on this revenue to achieve positive bottom-line results. ASSA constantly reviews its underwriting guidelines to improve the performance of business segments that are deviating from targets.

Positive rating actions could take place if the company is able to maintain growth in its capital base while sustaining improvements in its operating performance. Additionally, the quality of assets remains a key component of AM Best’s evaluation, as any deterioration could impact the company’s risk-adjusted capitalization.

Negative rating actions could occur if the company is not able to support its risks through its level of capital, especially given the high intangibles derived from the transaction with Generali. If asset quality deteriorates without any additional capital, risk-adjusted capitalization could become affected, which would then potentially affect the ratings of the company.

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 .

Key insurance criteria reports utilized:

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

  • Catastrophe Analysis in AM Best Ratings (Version Oct. 13, 2017)

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

  • Scoring and Assessing Innovation (March 5, 2020)

  • 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 Guide to Best’s Credit Ratings.

  • Previous Rating Date: June 7, 2019

  • Date Range of Financial Data Used: Dec. 31, 2013-Dec. 31, 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.

AM Best receives compensation for interactive rating services provided to organizations that it rates. AM Best may also receive compensation from rated entities for non-rating related services or products offered by AM Best. AM Best does not offer consulting or advisory services. For more information regarding AM Best’s rating process, including handling of confidential (non-public) information, independence, and avoidance of conflicts of interest, please read the AM Best Code of Conduct. 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 credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

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