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Best’s News & Research Service - April 27, 2023 04:02 PM (EDT)

AM Best Affirms Credit Ratings of Accelerant Holdings’ Rated Subsidiaries

  • April 27, 2023 04:02 PM (EDT)
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London //BestWire// - AM Best has affirmed the FSR of A- (Excellent) and the Long-Term ICR of “a-” (Excellent) of Accelerant Insurance Europe SA (AIE) (Belgium), Accelerant Specialty Insurance Company (ASIC) (Little Rock, AR), Accelerant National Insurance Company (ANIC) (Wilmington, DE), Accelerant Re Ltd. (Accelerant Re Bermuda) (Bermuda) and Accelerant Re (Cayman) Ltd. (Accelerant Re Cayman) (Cayman Islands). The companies are wholly owned subsidiaries of Accelerant Holdings (Accelerant), a non-operating holding company in the Accelerant group. The outlook of these Credit Ratings (ratings) is stable.

In AM Best’s view, AIE, ASIC, ANIC, Accelerant Re Bermuda and Accelerant Re Cayman are strategically important to, and integrated within, Accelerant. AIE, ASIC and ANIC play key roles in the group’s strategy of providing insurance capacity to managing general agents (MGA) in the United Kingdom, the European Union and the United States. Accelerant Re Cayman and Accelerant Re Bermuda are internal reinsurers within the group and are strategically important to their reinsurance and capital management strategies. Accelerant’s licensed (re)insurance carriers benefit from net worth maintenance agreements with the holding company.

The ratings reflect the consolidated balance sheet strength of Accelerant, which AM Best assesses as very strong, as well as the group’s adequate operating performance, limited business profile and appropriate enterprise risk management.

Accelerant was established in 2019 to provide insurance capacity to MGAs in the United Kingdom, Europe and the United States. The group also offers underwriting, claims handling and analytical support to its MGA partners. Accelerant reported gross written premium of over USD 1.1 billion in 2022, supported by capital and surplus of over USD 300 million and senior debt of approximately USD 100 million, as of April 2023.

Accelerant’s balance sheet strength is underpinned by consolidated risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). Risk-adjusted capitalisation is projected to remain at this level as the group executes its business plan. The balance sheet strength assessment also considers Accelerant’s good financial flexibility, low risk investment portfolio and strong liquidity profile. The group has a high dependence on reinsurance due to its strategy to retain a low level of underwriting risk. The associated credit risk is mitigated by the use of a diverse panel of financially strong counterparties.

The adequate operating performance assessment considers Accelerant’s business plan, taking into account heightened execution risk during its startup phase. AM Best expects the group to generate profitable underwriting returns over the longer term, reflective of the historical performance of its MGA members. Furthermore, the group’s fee-based income arising from its distribution related activities is expected to have significant contribution to its earnings.

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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