Press Release - OCTOBER 17, 2019
AM Best Affirms Credit Ratings of UnipolRe Designated Activity Company
FOR IMMEDIATE RELEASE
AMSTERDAM - OCTOBER 17, 2019
The ratings reflect UnipolRe’s balance sheet strength, which AM Best categorises as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
UnipolRe’s balance sheet strength is underpinned by risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). Following a EUR 100 million capital contribution from UnipolSai Assicurazioni S.p.A. (UnipolSai) during 2018 which increased paid-up capital to over EUR 300 million, AM Best expects the company’s risk-adjusted capitalisation to remain at the strongest level over the medium term.
UnipolRe reported a profit of EUR 4.7 million in 2018, with technical performance driven by a low level of losses from the company’s property catastrophe excess of loss business. During the second half of 2019, UnipolRe undertook considerable reserve strengthening for motor business relating to personal injury discount rate in the United Kingdom. Prospectively, AM Best expects underwriting results to be profitable, helped by lower expense ratios as the company achieves scale.
The company reported gross written premiums of EUR 195 million in 2018, representing 94% growth over 2017, and growth is expected to slow to approximately 30% in 2019. Although there is some geographic diversification, the portfolio is concentrated by line of business, with motor third-party liability reinsurance representing 66% of premiums in 2018.
UnipolRe seeks to differentiate itself by developing close partnerships with its cedants and assisting them with product development and pricing. It benefits from the experience and expertise of its parent, UnipolSai, in the motor sector and its association with that brand enhances its business profile. The group operates predominantly within Italy, where it has leading positions in non-life and life insurance markets.
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 credit rating agency and information provider with an exclusive focus on the insurance industry.