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Best’s News & Research Service - April 24, 2024 02:28 PM (EDT)

AM Best Affirms Credit Ratings of Interamericana de Fianzas y Seguros, S.A.

  • April 24, 2024 02:28 PM (EDT)
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//BestWire// - AM Best has affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” (Good) of Interamericana de Fianzas y Seguros, S.A. (IFS) (Panama). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect IFS’ 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 (ERM).

The stable outlooks reflect AM Best’s expectation that IFS will maintain its overall balance sheet strength assessment, supported by risk-adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), while ongoing strategic initiatives implemented by management will maintain stable operating performance over the intermediate term.

IFS was incorporated in August 2020 and is licensed to operate in Panama’s general insurance branches, as well as in the surety and individual lines of business. The company is based in Panama City, Panama. IFS develops its business inside Panama and has a diversified portfolio mainly focused in the surety line of business, in addition to property/casualty and life business. As of February 2024, IFS ranked as the country’s 18th largest insurer based on its 1.13% market share of overall premiums. IFS is Panama’s third-largest surety writer, with a 13.4% market share.

IFS’ very strong balance sheet strength assessment is based on its strongest level of risk-adjusted capitalization, as measured by BCAR, its conservative investment portfolio allocated mainly in Panama government bonds, solid liquidity measures that are enhanced by generally positive underwriting, and operating cash flows, as reflected by a return-on-equity ratio of 14.7% in 2023.

IFS has shown profitability since its inception, which is driven by improvements in its underwriting performance as reflected by premium sufficiency over the past three years. AM Best expects IFS to stabilize its operating performance in the following years while maintaining positive bottom-line results.

AM Best considers IFS’ ERM practices to be appropriate, as they were built in reference to the framework COSO Report 2013, 2017 and are well-integrated into its operations. The company has a sound reinsurance program in place with highly rated reinsurers.

Negative rating actions could derive from a deterioration in IFS’ underwriting practices to maintain high growth targets that could lead to pressure its operating performance. Negative rating actions also could take place if there is a deterioration in the company’s risk-adjusted capitalization due to major capital outflows and rapid premium growth on a net basis. While no positive rating actions are foreseen in the short term, a positive impact on the ratings could take place in the medium term if the company’s capital base increases while maintaining a risk-adjusted capitalization at the strongest level.

The methodology used in determining these ratings is Best’s Credit Rating Methodology (Version Jan. 18, 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

Key insurance criteria reports utilized:

  • Available Capital and Insurance Holding Company Analysis (Version Jan. 18, 2024)

  • Evaluating Country Risk (Version May 4, 2023)

  • Scoring and Assessing Innovation (Version Feb. 27, 2023)

  • Understanding Global BCAR (Version March 7, 2024)

  • Rating New Company Formation (Sept. 7, 2023)

  • Rating Surety Companies (April 7, 2021)

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: March 29, 2023

  • Initial Rating Date: March 29, 2023

  • Date Range of Financial Data Used: Dec. 31, 2020-Dec. 31, 2023

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

This press release relates to rating(s) that have been published on AM Best's website. For additional 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.

If the ratings referred in this press release do not indicate a specific country suffix, it is understood that they are granted globally and not on a national scale.

AM Best does not validate or certify the information provided by the client in order to issue a credit rating.

While the information obtained from the material source(s) is believed to be reliable, its accuracy is not guaranteed. AM Best does not audit the company’s financial records or statements, or otherwise independently verify the accuracy and reliability of the information; therefore, AM Best cannot attest as to the accuracy of the information provided.  

AM Best’s credit ratings are independent and objective opinions, not statements of fact. AM Best is not an Investment Advisor, does not offer investment advice of any kind, nor does the company or its Ratings Analysts offer any form of structuring or financial advice. AM Best’s credit opinions are not recommendations to buy, sell or hold securities, or to make any other investment decisions. View our entire notice for complete details.

AM Best receives compensation for interactive rating services provided to organizations that it rates. AM Best may also receive compensation from rated entities for non-rating related services or products offered by AM Best. AM Best does not offer consulting or advisory services. AM Best keeps certain activities of its business units separate from each other to preserve the independence and objectivity of their respective activities. As a result, certain business units of AM Best may have information that is not available to other AM Best business units. AM Best has established policies and procedures to maintain the confidentiality of certain confidential (non-public) information received in connection with each analytical process. For more information regarding AM Best’s rating process, including handling of confidential (non-public) information, independence, and avoidance of conflicts of interest, please read the AM Best Code of Conduct. 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 specializing 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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