Press Release - AUGUST 24, 2018

A.M. Best Affirms Credit Ratings of Builders Reinsurance S.A. and Builders Direct S.A.


CONTACTS:
 George Athanasopoulos
Financial Analyst
+44 20 7397 0330
george.athanasopoulos@ambest.com

Mathilde Jakobsen
Director, Analytics
+44 20 7397 0266
mathilde.jakobsen@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

LONDON - AUGUST 24, 2018
A.M. Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of Builders Reinsurance S.A. (Builders Re) (Luxembourg) and Builders Direct S.A. (Builders Direct) (Luxembourg), both subsidiaries of HOCHTIEF Aktiengesellschaft (HOCHTIEF), a large Germany-based construction company that is majority owned by Actividades de Construcción y Servicios S.A. (ACS). The outlook of these Credit Ratings (ratings) remains stable.

The ratings reflect Builders Re’s balance sheet strength, which A.M. Best categorises as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

Builders Re’s balance sheet strength is supported by its risk-adjusted capitalisation being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). A.M. Best expects Builders Re’s risk-adjusted capitalisation to remain at a strongest level, supported by good internal capital generation.

Builders Re has a track record of strong and stable operating performance, largely driven by robust underwriting results, as demonstrated by a three-year average combined ratio of 79.8%. Prospective performance is subject to some volatility, mainly from exposure to potential aggregation of losses. The company partly mitigates this risk by purchasing whole account quota share cover from financially strong reinsurers.

Builders Re’s business profile assessment reflects the company’s geographically concentrated portfolio of casualty risks that emanate from HOCHTIEF’s construction operations in North America. Builders Re also reinsures the business emanating from HOCHTIEF’s smaller insurance company, Builders Direct.

Builders Direct’s ratings primarily reflect its strategic importance to Builders Re as a source of business growth and diversification, as well as explicit support from Builders Re in the form of reinsurance protection. Builders Direct was created in 2013 and provides insurance cover to the HOCHTIEF group, as well as to third-party entities with a focus on mutual companies.

A.M. 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.

This press release relates to rating(s) that have been published on A.M. 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 A.M. 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 A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry.


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