AM Best

AM Best Downgrades Credit Ratings of Kelvin Re Limited; Revises Under Review Status to Developing


Dale Kirby
Financial Analyst
+44 20 7397 0276

William Keen-Tomlinson
Associate Director, Analytics
+44 20 7397 4395
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159

Jeff Mango
Managing Director, Strategy & Communications
+1 908 439 2200, ext. 5204


LONDON - JUNE 16, 2022 11:28 AM (EDT)
AM Best has downgraded the Financial Strength Rating (FSR) to B+ (Good) from A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb-” (Good) from “a-” (Excellent) of Kelvin Re Limited (Kelvin Re) (Guernsey). Concurrently, AM Best has maintained the under review status on these Credit Ratings (ratings) and revised the implications status to developing from negative.

The ratings reflect Kelvin Re’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. The ratings also factor, in the form of drag, Kelvin Re’s association with its parent company, Cowen Inc. (Cowen).

The rating actions follow the recent acquisition of Kelvin Re by Cowen, a U.S.-based multinational financial services group headquartered in New York, NY. The rating downgrades reflect the impact of drag due to the financial strength of its new parent company and Kelvin Re’s reduced level of financial flexibility due to its new ownership. The under review with developing implications status is due to uncertainty regarding Kelvin Re’s future strategy, as well as the degree of independence it has from Cowen. AM Best expects to resolve the under review status once a full analysis of the company’s credit fundamentals can be performed, including the impact of its prospective business plans.

Kelvin Re has been in run-off since December 2020, and its short-tail book of property-related reserves are expected to develop positively over the coming years. The company’s post-acquisition capital base of approximately USD 400 million is expected to support the run-off of its business adequately. However, future plans for new business are unknown at present. Kelvin Re’s investment portfolio is concentrated toward a loan to its parent company, Cowen. However, the future investment strategy is expected to carry lower risk and involves holding surplus assets in equities and U.S. treasuries. Assets backing Kelvin Re’s reserves are invested in low risk, liquid investments.

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 Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising 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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AMB# Company Name
093711 Kelvin Re Limited