Best’s News & Research Service - July 17, 2025 04:36 PM (EDT)
AM Best Upgrades Issuer Credit Rating of AVLA Perú Compañía de Seguros S.A.
- July 17, 2025 04:36 PM (EDT)
//BestWire// - AM Best has upgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb+” (Good) from “bbb” (Good) and affirmed the Financial Strength Rating of B++ (Good) of AVLA Perú Compañía de Seguros S.A. (AVLA Perú) (Lima, Peru). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect AVLA Perú balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
The upgrade of AVLA Perú’s Long-Term ICR recognizes its affiliation and strategic importance to its ultimate parent, AVLA Bermuda Holding Corp Ltd. (ABHC), a financial holding company domiciled in Bermuda that is engaged in insurance operations in Chile, Peru, Mexico, Brazil and the United States. As of May 2025, ABHC had equity of USD 89 million.
The stable outlooks reflect AM Best’s expectation that the company will be able to continue growing and return to profitable technical results, while maintaining its risk-adjusted capitalization.
AVLA Perú is a surety, credit and property/casualty insurer that began operations in 2015. The company specializes in surety and complimentary lines of credit insurance, as well as a property line, engineering. AVLA Perú remains in the top 10 among Peru’s non-life carriers and top three in the country’s surety segment, based on market share.
AM Best views AVLA Perú business profile as neutral. Since its creation in 2015, AVLA Perú has capitalized successfully on Peru’s guarantee market, which has limited capacity, and become one of the country’s main participants for credit insurance and surety. AM Best’s neutral assessment of the company’s business profile reflects the size of its operation within a small segment in Peru.
AM Best considers the company’s operating performance to be adequate. AVLA Perú has been able to promote its products in a profitable manner and maintain adequate underwriting performance since 2017, taking proactive steps to manage claims due to market events and developing alternatives for revenue. AVLA Perú’s technical results have been complemented by an active investment strategy that generated good investment results in 2024.
AVLA Perú’s balance sheet strength assessment is very strong given its solid capital base for the risks it undertakes, as reflected in its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). The very strong balance sheet strength assessment also recognizes the company’s capital management capabilities and shareholders’ willingness and proven history of making capital contributions to support AVLA Perú’s growth. A panel of reinsurers supports AVLA Perú’s balance sheet strength level with excellent security.
Positive rating actions could take place if AVLA Perú is able to achieve a consistent upward trend in risk-adjusted capitalization, underpinned by positive bottom-line results. Negative rating actions could occur if the operating performance of AVLA Perú deteriorates due to further losses to a point no longer supportive of the adequate assessment. Negative rating actions could occur if in AM Best's opinion, the strategic importance of AVLA Perú to its group decreased significantly or if the consolidated financial strength of the AVLA Group deteriorated to a point no longer supportive of the current ratings.
The methodology used in determining these ratings is Best’s Credit Rating Methodology (Version Aug. 29, 2024), 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 June 6, 2024)
· Understanding Global BCAR (Version Aug. 1, 2024)
· Rating Surety Companies (Version April 25, 2024)
· Available Capital and Insurance Holding Company Analysis (Version Aug. 15, 2024)
· Scoring and Assessing Innovation (Version Feb. 20, 2025)
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, relevant sources of information and the frequency for updating ratings, please refer to Guide to Best’s Credit Ratings.
· Previous Rating Date: June 14, 2024
· Initial Rating Date: Dec. 5, 2018
· Date Range of Financial Data Used: Dec. 31, 2019-Mar. 31, 2025
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