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FOR IMMEDIATE RELEASE
LONDON - JANUARY 31, 2017 01:54 PM (EST)
A.M. Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of Gulf Reinsurance Limited (Gulf Re) (United Arab Emirates), the wholly owned subsidiary of Arch Reinsurance Ltd (Arch Re), which is ultimately owned by Arch Capital Group Ltd. (Arch). The outlook of these Credit Ratings (rating) is stable. Concurrently, A.M. Best has withdrawn the ratings as the company has requested to no longer participate in A.M. Best’s interactive rating process.
Gulf Re ceased accepting new business as at 1 November 2016. The Dubai-based company operated as a specialist reinsurer, underwriting a portfolio of largely short-tailed risks derived from the Gulf Cooperation Council countries, with gross written premiums of USD 42 million in 2015.
The ratings of Gulf Re reflect A.M. Best’s opinion that Arch remains committed to supporting the company’s policyholders’ obligations. Gulf Re benefits from a 90% whole account quota share arrangement with its intermediate parent, Arch Re, which protects its net obligations arising from contracts written since October 2014, and a loss portfolio transfer arrangement that covers all policies written prior to October 2014.
Based on unaudited interim results as at September 2016, Gulf Re’s risk-adjusted capitalisation remains at a strong level, supported by a rise in share capital and the absence of net premium volume. Residual underwriting risk remains, owing to Gulf Re’s net exposure to risks incepting after 2014. A.M. Best understands that there are currently no plans to dividend capital out of Gulf Re.
This press release relates to Credit Ratings 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.
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