OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has affirmed the financial strength rating of A (Excellent) and issuer credit rating of “a” of Seguros Inbursa, S.A. Grupo Financiero Inbursa (Seguros Inbursa) (Mexico). The outlook for both ratings is stable.
The ratings reflect Seguros Inbursa’s supportive capitalization and consistent and sustained earnings, historically strong investment income and diversified business profile. The ratings also reflect the company’s affiliation with Grupo Financiero Inbursa S.A.B. de C.V. (Grupo Financiero Inbursa), one of the largest financial groups in Mexico.
Seguros Inbursa writes both life and non-life business and remains one of the larger and more profitable domestic insurance companies operating in Mexico. The company’s focus on expense management, along with consistent levels of investment income, has historically resulted in favorable overall earnings. This has enabled Seguros Inbursa to continue to enhance its risk-adjusted capitalization. In addition, Seguros Inbursa continues to benefit from synergies and significant operating efficiencies as a result of its access to Grupo Financiero Inbursa’s vast financial and system networks.
Seguros Inbursa has shown disciplined underwriting in a highly competitive market, while its risk-based capitalization remains fully supportive of its current ratings and outlook. Seguros Inbursa’s profitability is complemented by consistent levels of investment income.
Partially offsetting these positive rating factors are Seguros Inbursa’s continuing underwriting losses in key business segments and its reliance on investment income for its overall earnings. In addition, the Mexican insurance market remains very competitive, and Seguros Inbursa will be challenged to maintain profitability and market share.
Potential positive rating triggers would include sustained improvement in Seguros Inbursa’s underwriting results in conjunction with tangible improvements in Mexico’s regulatory environment and other country risk metrics. Possible negative rating triggers would include deterioration in the company’s underwriting results, and consequently, a decline in its risk-based capitalization.
While Seguros Inbursa is well positioned at its current rating level, factors that may lead to rating enhancement include sustained improvement in the company’s underwriting performance and an upgrading of Mexico’s country risk tier rating.
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