MEXICO CITY--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of Reaseguradora America SPC Ltd. (RAM Re) (Cayman Islands). The outlook of these Credit Ratings (ratings) is stable.
RAM Re is a subsidiary of ASSA Compañía Tenedora S.A. and owned ultimately by Grupo ASSA, S.A., a financial services holding company publicly traded on the Panama Stock Exchange.
The ratings reflect RAM Re’s balance sheet strength, which AM Best categorizes as strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
RAM Re is registered as a segregated portfolio company, licensed as a Class B(iii) insurer under the Cayman Islands’ insurance law, which allows large clients to place proprietary risks through underlying cells.
The ratings reflect RAM Re´s continued strong risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), sound operating performance, and its affiliation to Grupo ASSA, S.A., which provides synergies and operating efficiencies, as well as parental support and an appropriate ERM framework.
AM Best expects RAM Re to maintain risk-adjusted capitalization levels supportive of its current ratings amid material changes in its business profile, driven by ongoing developments in its segregated portfolio cells. Concerns regarding business volume growth and new portfolio integration, which pressure the company´s capital base, are expected to be offset in the immediate term through the successful implementation of RAM Re’s strategy.
Factors that could lead to positive rating actions include sustained improvements in risk-adjusted capitalization initially supported on the successful materialization of developments concerning RAM Re’s business profile, including its strategy driven by the integration of a new segregated portfolio cell. Factors that could lead to negative rating actions include a deterioration in risk-adjusted capitalization levels driven by an unsuccessful materialization of developments concerning RAM Re’s business profile, including the failed adoption of its strategy attempting the integration of a new segregated portfolio cell.
AM Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.
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