Best’s News & Research Service - October 09, 2025 12:30 PM (EDT)
AM Best Removes from Under Review and Affirms Credit Ratings of The Hand-in-Hand Mutual Fire Insurance Co Ltd; Downgrades Issuer Credit Rating of Hand-in-Hand Mutual Life Assurance Co Ltd
- October 09, 2025 12:30 PM (EDT)
//BestWire// - AM Best has removed from under review with negative implications status and affirmed the Financial Strength Rating (FSR) of B++ (Good) and Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb+” (Good) of The Hand-in-Hand Mutual Fire Insurance Company Limited (HIHF) (Guyana). The outlook assigned to the Long-Term ICR is negative, while the outlook assigned to the FSR is stable.
Concurrently, AM Best has removed from under review with negative implications and downgraded the Long-Term ICR to “bbb” (Good) from “bbb+” (Good) and affirmed the FSR of B++ (Good) of Hand-in-Hand Mutual Life Assurance Company Limited (HIHL). AM Best has assigned negative outlooks to these Credit Ratings (ratings). Both entities are collectively referred to as Hand-in-Hand Group.
The ratings of HIHF reflect its 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 (ERM).
The ratings of HIHL reflect its balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, neutral business profile and appropriate ERM.
The downgrade of HIHL’s Long-Term ICR reflects its risk-adjusted capitalization no longer being supportive of a very strong balance sheet assessment. This is due to pressure stemming from HIHL’s high exposure to domestic equity securities given the market’s limited available investment instruments, despite the portfolio's solid performance, which is in line with the country’s current favorable macro-economic conditions.
The revised outlooks to negative of HIHL and HIHF’s Long-Term ICR reflect AM Best’s concern over the group's ERM framework and corporate governance practices considering its recent adoption of enhanced accounting standards, as well as exposure to potential emerging risks that could arise given Guyana´s dynamic economic environment. Hand-in-Hand Group has consistently experienced delays over the past two years in reporting audited financial information, an issue that conflicts with AM Best practices, which could add uncertainty regarding the group’s overall financial position and performance in a timely manner.
Established in 1865, HIHF is Guyana’s oldest insurance company and the second-largest carrier in the country’s insurance industry. The company writes property and casualty lines of business with its product portfolio composed mainly by fire and motor coverages, although it also operates in the accidents and liability market.
HIHL was incorporated in 1966, and as a mutual company, it is owned by policyholders with a small amount of preferred shares issued to HIHF. The company is engaged predominantly in underwriting group health and life insurance, with a significant portfolio of ordinary life and annuities. Overall, the Guyana insurance market has experienced material growth in recent years.
HIHF and HIHL’s balance sheet strength assessments of very strong and strong, respectively, reflect their stable capital bases, with adequate asset-liability management and proper reinsurance coverages. However, investment risk is an important component of the required capital, due to the limited available securities in the market in which both companies operate. As mutual insurers, the quality of the capital is very good because of its stability; main outflows come from triennial profit-sharing with entitled policyholders.
Operating performance at both companies is considered adequate with manageable loss and benefits paid ratios. However, each company has seen some volatility in premium growth and their reported bottom-line results, although results historically have been mostly positive. AM Best expects both companies to continue strengthening their ERM capabilities.
Negative rating actions for HIHF and HIHL could occur if there is a significant decline in their capital bases to a level no longer supportive of the ratings, or if operating performance deteriorates over time from sustained underwriting or net losses. Additionally, negative rating actions could also occur if AM Best’s view of the adequacy of the group’s ERM and corporate governance practices deteriorates.
Positive rating actions for HIHF could take place if the company maintains its current trend in risk-adjusted capitalization while building up its capital base in a consistent manner. Positive rating actions for HIHL could take place if the company reflects improvements in its balance sheet strength assessment, underpinned by an enhanced risk-adjusted capitalization, while building up its capital base in a consistent manner.
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:
· Available Capital and Insurance Holding Company Analysis (Version Sept. 18, 2025)
· Evaluating Country Risk (June 6, 2024)
· Scoring and Assessing Innovation (Version Feb. 20, 2025)
· Understanding Global BCAR (Version Sept. 18, 2025)
· Catastrophe Analysis in AM Best Ratings (Version Feb. 8, 2024) HIHF
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: Nov. 12, 2024
· Initial Rating Date: Aug. 26, 2022
· Date Range of Financial Data Used: Dec. 31, 2017-Dec. 31, 2024
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