JUNE 17, 2020 01:56 PM (EDT)
AM Best Affirms Credit Ratings of Reaseguradora America SPC Ltd.
FOR IMMEDIATE RELEASE
MEXICO CITY - JUNE 17, 2020 01:56 PM (EDT)
RAM Re is a subsidiary of ASSA Compañía Tenedora S.A. and owned ultimately by Grupo ASSA, S.A., a financial services holding company publicly traded on the Panama Stock Exchange.
The ratings reflect RAM Re’s balance sheet strength, which AM Best categorizes as strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
RAM Re is registered as a segregated portfolio company, licensed as a Class B(iii) insurer under the Cayman Islands’ insurance law, which allows large clients to place proprietary risks through underlying cells.
The ratings reflect RAM Re´s continued strong risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), sound operating performance, and its affiliation to Grupo ASSA, S.A., which provides synergies and operating efficiencies, as well as parental support and an appropriate ERM framework.
AM Best expects RAM Re to maintain risk-adjusted capitalization levels supportive of its current ratings amid material changes in its business profile, driven by ongoing developments in its segregated portfolio cells. Concerns regarding business volume growth and new portfolio integration, which pressure the company´s capital base, are expected to be offset in the immediate term through the successful implementation of RAM Re’s strategy.
Factors that could lead to positive rating actions include sustained improvements in risk-adjusted capitalization initially supported on the successful materialization of developments concerning RAM Re’s business profile, including its strategy driven by the integration of a new segregated portfolio cell. Factors that could lead to negative rating actions include a deterioration in risk-adjusted capitalization levels driven by an unsuccessful materialization of developments concerning RAM Re’s business profile, including the failed adoption of its strategy attempting the integration of a new segregated portfolio cell.
AM Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.
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:
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.
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.
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