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FOR IMMEDIATE RELEASE
LONDON - APRIL 26, 2024 08:28 AM (EDT)
AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” (Excellent) of the rated operating subsidiaries of SiriusPoint Ltd. (SiriusPoint) (Bermuda) [NYSE: SPNT]. Additionally, AM Best has affirmed the Long-Term ICR of “bbb-” (Good) of SiriusPoint, which is a non-operating holding company. The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies and ratings).
The ratings reflect SiriusPoint’s consolidated 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 ratings of the group’s operating subsidiaries factor in their strategic importance to SiriusPoint.
SiriusPoint’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which was at the strongest level at year-end 2023, as measured by Best’s Capital Adequacy Ratio (BCAR). This assessment also considers the significant de-risking of SiriusPoint’s asset base over the course of 2022 and 2023, following the redemption of more than USD 600 million from related party investment funds and the reinvestment of the proceeds into high quality fixed income securities. Consequently, at year-end 2023, cash and fixed income securities comprised 94% of SiriusPoint's investment portfolio, up from 79% in 2021. A partially offsetting rating factor is the group's limited capital fungibility due to a significant, albeit reducing, portion of consolidated available capital being held as a safety reserve in the group’s Sweden subsidiary.
For year-end 2023, SiriusPoint recorded a profitable underwriting result, evidenced by a 93% combined ratio (as calculated by AM Best), a material improvement against the previous year of 107%. AM Best expects SiriusPoint’s prospective underwriting results to remain profitable with reduced volatility as its management continues to rebalance the business mix away from catastrophe-exposed property business toward less volatile accident and health and specialty lines. SiriusPoint reported a robust pre-tax profit of USD 319 million in 2023, benefitting from a rebound in both underwriting and investment income, the release of USD 105 million of reserves following the completion of a loss portfolio transfer, as well as a one-time deferred tax benefit of USD 101 million attributable to the enactment of the Bermuda corporate income tax.
SiriusPoint’s neutral business profile assessment reflects its market position as a mid-tier global (re)insurer, which operates from platforms in Europe, the United States, Bermuda and at Lloyd’s. The group has a good level of diversification by line of business, which is expected to improve further as it executes its business plan.
The FSR of A- (Excellent) and the Long-Term ICRs of “a-” (Excellent) have been affirmed, with stable outlooks for the following subsidiaries of SiriusPoint Ltd.:
• SiriusPoint America Insurance Company
• SiriusPoint Bermuda Insurance Company Ltd.
• SiriusPoint International Insurance Corporation (publ)
• SiriusPoint Specialty Insurance Corporation
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.