AM Best Assigns Credit Ratings to Sparrowhawk Re SPC
- October 07, 2026 02:37 PM (EDT)
//BestWire// - AM Best has assigned a Financial Strength Rating of B++ (Good) and a Long-Term Issuer Credit Rating of “bbb” (Good) to Sparrowhawk Re SPC (Sparrowhawk) (Cayman Islands). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect Sparrowhawk’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
Sparrowhawk’s balance sheet strength is assessed at the strong level and supported by a projected very strong level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). Sparrowhawk is supported by capital contributions from BC Partners Credit with an expectation that the initial capital contributions and commitment will be sufficient to fund the company’s business plan during the first two years. The company’s investment allocation is expected to reflect a diversified mix of vast majority investment grade holdings, primarily fixed-income securities, managed by BC Partners Credit.
Additionally, Sparrowhawk has initially launched with reinsured multi-year guaranteed annuities (MYGA) policies making up 100% of its reserves and the team plans on sourcing additional cedants for MYGA and fixed-indexed annuities (FIA) in the near term.
Sparrowhawk’s operating performance is assessed as adequate. As a newly formed entity, longer-term profitability trends will still need to be evaluated. Sparrowhawk’s business profile is assessed as limited, reflecting its recent entrance into the competitive offshore asset intensive market, with its plans to reinsure MYGA and FIA products. The company’s business plan centers around partnering with low to mid-sized annuity writers via various origination channels and various liability types by leveraging BC Partners Credit’s bespoke relationship with insurance companies. Also, the company benefits from a seasoned management team on the BC Partners Credit platform with strong experience in insurance, investments, operations and capital raising.
The company’s ERM is considered appropriate and reflects the establishment of its risk management framework, clear governance structure and oversight from experienced C-suite level officers and its board of directors.
As a newly established company, AM Best will closely monitor Sparrowhawk Re as it executes its business strategy. Negative rating movement could occur if Sparrowhawk is unable to obtain capital to execute its business plan. While unlikely, positive rating action may occur if Sparrowhawk is able to expand its business profile beyond its business plan.
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 (BCR), Best’s Performance Assessments (PA), Best’s Preliminary Credit Assessments (PCA) 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.