DECEMBER 08, 2021 12:23 PM (EST)
AM Best Affirms Credit Ratings of Chubb Perú S.A. Compañía de Seguros y Reaseguros
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FOR IMMEDIATE RELEASE
MEXICO CITY - DECEMBER 08, 2021 12:23 PM (EST)
AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” (Excellent) of Chubb Perú S.A. Compañía de Seguros y Reaseguros (Chubb Perú) (Lima, Perú). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Chubb Perú’s 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).
Chubb Perú initiated operations in 1998 as Altas Cumbres; in 2007, it was acquired by ACE Group and named ACE Seguros S.A., until 2016, when ACE Limited acquired the Chubb Corporation and re-branded the company.
Chubb Perú has a diversified book of business, distributed through a mix of traditional and massive channels, such as large regional retailers and banks. Currently, 72% of its business portfolio is composed of property/casualty products, with accident and health making up 22% of the portfolio and life insurance the remaining 6%. As of September 2021, Chubb Perú is the ninth-largest insurance operation in Peru, with a market share of 2.2%.
AM Best considers Chubb Perú’s balance sheet strength to be very strong, as the company has a defined risk appetite that limits exposures and protects its solid capital base through adequate investment, reinsurance and underwriting principles. Additionally, the company has a comprehensive reinsurance program with its affiliate, Chubb Tempest Reinsurance Ltd. In 2020, the company’s risk adjusted capitalization remained stable due to adjustments in its business offerings, which in tandem with no dividend payments continued to support the company’s capital position.
The 2020 year-end results reflect the company’s efficiencies in acquisition costs that were able to mitigate the impact of COVID-19 in its credit life performance, resulting in a 27% increase in net income. Results through September 2021 remain positive, backed by alignments in strategy to limit exposure to complicated segments such as surety and credit life.
The company benefits from its integration into the Chubb group, gaining operational advantage through the same systems, procedures and ERM practices. The group has demonstrated its support to Chubb Perú by providing a comprehensive reinsurance program with its affiliate and actively overlooking its strategy. The stable outlooks reflect AM Best’s expectation that the company can continue to adjust its product offerings in a profitable manner, supported by its parent company.
Negative rating actions could occur if there is a sharp deterioration in operating performance or a significant weakening of its risk-adjusted capitalization. The ratings also could be downgraded if AM Best determines that Chubb Perú’s strategic importance to its group has diminished.
The methodology used in determining these ratings is Best’s Credit Rating Methodology (Version Nov. 13, 2020), 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:
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, please refer to Guide to Best’s Credit Ratings.
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.
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.
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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.