AM Best Information Services

MARCH 25, 2021 04:18 PM (EDT)

AM Best Affirms Credit Ratings of Aseguradora General, S.A.

 Elí Sánchez
Associate Director
+52 55 1102 2720, ext. 122

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

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


MEXICO CITY - MARCH 25, 2021 04:18 PM (EDT)
AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb” of Aseguradora General, S.A. (AGen) (Guatemala). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect AGen’s balance sheet strength, which AM Best assesses as strongest, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management.

The stable outlooks reflects AM Best’s expectation that the company’s prudent capital management will allow current balance sheet strength to continue amid a gradual increase in claim frequency and a slow economic recovery.

AGen was established in 1967 and is the fourth-largest insurer operating in Guatemala. As of year-end 2020, the company reported USD 84.5 million in direct premium, with a market share of 8.1%. The company underwrites a mixed portfolio of life and non-life business, with its retained premium distributed among major medical expenses (68%), auto (16%), group life (6%), diverse property/casualty offerings (7%) and universal life (3%). The business profile of the company is assesses as neutral, supported by its importance in its domestic market but limited by its geographic and product concentration.

The company’s majority shareholder is Luensi, S.A. (Luensi) (Guatemala), a pure holding company with investments in insurance, real estate and banking. Assicurazioni Generali S.p.A. previously owned AGen, but in May 2017, Luensi and a group of investors bought a 51% stake.

As of December 2020, Guatemala ranked as the third-largest insurance market in Central America at USD 1 billion, expanding in real terms at a 1% rate annually, with good growth prospects for Guatemala’s economy as the impact of the pandemic has been mitigated partially by countercyclical economic policies.

AM Best considers AGen’s balance sheet strength to be at the strongest level. Supporting the capital base is a well-structured reinsurance program that properly limits the exposure of its capital base to catastrophic events. The holding company places negative pressure on AGen’s ratings by limiting its financial flexibility due to substantial dividend payments to Luensi. AGen’s ERM practices are considered appropriate as its management capabilities are sufficient to meet its risk appetite.

AM Best views the company’s operating performance as marginal, recognizing that despite results posted in 2020, claims experience could revert gradually in 2021 to pre-pandemic levels, and growth in premiums still needs to recover amid a challenging economic environment. Net income has remained positive for the last five years, strongly supported by revenue coming from deferred premium and premium issuance rights predominantly from the major medical expenses offerings of the company.

Positive rating actions could take place if financial leverage at the holding company diminishes and is less dependent on the dividends of AGen to meet its financial obligations. Negative rating actions could take place if the business profile of the company limits its operating performance in terms of quality of underwriting and bottom-line results. Negative rating actions could also take place if there are significant capital outflows, including dividends that in AM Best’s opinion limit the capacity of the company’s capital base to face its risks.

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:

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

  • Understanding Universal BCAR (Version March 11, 2021)

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

  • Scoring and Assessing Innovation (Version March 5, 2020)

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: March 4, 2020.

  • Date Range of Financial Data Used: Dec. 31, 2014-Jan. 31, 2021

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.

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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 London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

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