OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has upgraded the Financial Strength Rating to A- (Excellent) from B++ (Good) and the Long-Term Issuer Credit Rating to “a-” (Excellent) from “bbb+” (Good) of Century Insurance Company (Guam) Limited (CIC Guam) (Guam). The outlook of these Credit Ratings (ratings) has been revised to stable from positive.
The ratings reflect CIC Guam’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management (ERM).
The upgrading of the ratings reflects CIC Guam’s strong operating performance in recent periods, which compares favorably to composite averages. CIC Guam has reported underwriting profits for nine consecutive years and net income in each of the last 10 years. In 2023, the company was impacted by the most severe weather event since 2002, with Typhoon Mawar passing over Guam. Despite this event, CIC Guam exceeded expectations with an 83.1% combined ratio, demonstrating the effectiveness of the reinsurance program. Results through the first half of 2024 continue to be favorable with the company improving its combined ratio to 78%.
CIC Guam’s overall balance sheet strength of very strong is supported by the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), which is expected to be maintained in future periods. The assessment is further supported by growth in policyholders’ surplus over the long term, low underwriting leverage and consistent favorable loss reserve development. CIC Guam’s limited business profile reflects its narrow operations focused in Guam with multiple product offerings. The company maintains an appropriate ERM program, which includes a robust reinsurance program to mitigate severe weather losses stemming from its concentrated exposure, including Typhoon Mawar in May 2023.
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