Press Release - JANUARY 10, 2019

AM Best Affirms Credit Ratings of Aserta Seguros Vida, S.A. de C.V., Grupo Financiero Aserta


CONTACTS:
 Olga Rubo
Associate Financial Analyst
+52 55 1102 2720, ext. 134
olga.rubo@ambest.com

Alfonso Novelo
Senior Director, Analytics
+52 55 1102 2720, ext. 107
alfonso.novelo@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

MEXICO CITY - JANUARY 10, 2019
AM Best has affirmed the Mexico National Scale Rating of “aa+.MX”, the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb+” of Aserta Seguros Vida, S.A. de C.V., Grupo Financiero Aserta (ASV) (Mexico City, Mexico). The outlook of these Credit Ratings (ratings) remains stable.

The ratings reflect ASV’s balance sheet strength, which A.M. Best categorizes as strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The ratings reflect ASV’s integration into Grupo Financiero Aserta, S.A. de C.V. (GFA) in terms of operations, capital support, business infrastructure and ERM. Mitigating these positive factors are the start-up nature of the company and the volatility in the bottom line results inherent in a recently created life insurer.

ASV started operations in 2012, focusing on life microinsurance, group life and accident & health. In 2013, GFA acquired a majority stake of the company and was granted regulatory approval to be a member of the financial group. As of September 2018, group life business comprised 99.56% of the ASV’s business portfolio with accident & health accounting for 0.43%, and individual life for the remaining 0.02%. ASV ranked as the 25th largest insurer in Mexico’s life segment based on gross written premium, with a market share of less than 1%, as of September 2018.

During 2017, ASV presented an important increase in the loss ratio, after which the company took a series of measures in order to improve its underwriting quality and revise its cost structure. As of September 2018, the company continued to grow considerably, which allowed it to mitigate administrative expenses, and post a positive bottom line result of MXN 24.2 million.

Risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), remains strong, reflecting the capital support from its parent. The last capital contribution took place in 2017, in order to offset the net loss.

Going forward, AM Best expects ASV to stabilize its results and underwriting in the medium term and to keep expanding its distribution network to achieve a larger scale. Positive rating actions may occur if the company is able to improve its operating performance and capitalization while achieving a larger scale of business. Negative rating actions could occur if GFA’s support diminishes in A.M. Best’s view or if operating performance deteriorates and capital erodes significantly.

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:


  • Evaluating Country Risk (Version Oc.t 13, 2017)

  • Understanding Universal BCAR (Version May 14, 2018)

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

  • A.M. Best’s Ratings On a National Scale (Version Oct. 13, 2017)

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 Understanding Best’s Credit Ratings.


  • Previous Rating Date: Dec. 20, 2017

  • Date of Financial Data Used: Sept. 30, 2018

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 rating agency and information provider with a unique focus on the insurance industry.


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AMB# Company Name
092888 Aserta Seguros Vida, S.A. de C.V.