SINGAPORE--(BUSINESS WIRE)--A.M. Best has affirmed the financial strength rating of A- (Excellent) and the issuer credit rating of “a-” of ACR ReTakaful Berhad (ACR ReTakaful) (Malaysia) and ACR ReTakaful MEA B.S.C. (c) (ACR ReTakaful MEA) (Bahrain). A.M. Best has also affirmed the ICR ratings of “bbb-” of ACR ReTakaful Holdings Limited (United Arab Emirates). The outlook for all ratings is stable.
The affirmations for both ACR ReTakaful and ACR ReTakaful MEA consider the de-risking exercise on their underwriting portfolios and their plans to rebuild those with profitable, less volatile business. Stable investment results from the relatively large and prudently managed investment portfolios are expected to help offset both companies’ high expense ratios during this period.
Offsetting rating factors include the policyholder fund deficiencies in both companies, which remain relatively large and reduce the available capital for potential business growth going forward. ACR ReTakaful MEA’s capital base will be further reduced as ACR ReTakaful Holdings Limited seeks to redeploy some of its capital. ACR ReTakaful MEA’s risk-adjusted capitalization, however is expected to remain supportive of its ratings.
The ratings of ACR ReTakaful Holdings Limited recognize the standard notching from its operating entities (ACR ReTakaful and ACR ReTakaful MEA).
Rating upgrades are unlikely for both ACR ReTakaful and ACR ReTakaful MEA.
Negative rating pressure for ACR ReTakaful could result from a material deterioration of its risk-adjusted capitalization as a result of higher than expected business growth.
Negative rating pressure for ACR ReTakaful MEA could result from continued and higher than expected capital reductions.
The methodology used in determining these interactive ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. 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:
• Catastrophe Analysis in A.M. Best Ratings
• Rating Members of Insurance Groups
• Risk Management and the Rating Process for Insurance Companies
• Understanding Universal BCAR
• Takaful (Shari’a Compliant) Insurance Companies
• Evaluating Country Risk
• Insurance Holding Company and Debt Ratings
Ratings are communicated to rated entities prior to publication, and unless stated otherwise, the ratings were not amended subsequent to that communication.
This press release relates to rating(s) that have been published on A.M. 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 visit A.M. Best’s Ratings & Criteria Center.
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