OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Ratings of “bbb+” of Republic Insurance Company (Cayman) Limited (Republic Insurance) (Cayman Islands). The outlook of these Credit Ratings (ratings) is stable.
Republic Insurance’s ratings reflect the company’s established niche in the reinsurance of credit insurance and the strength of its parent, Republic Financial Holdings Limited (Republic Financial) [Trinidad and Tobago Exchange: RFHL]. Republic Financial has been in business for 180 years with a track record of banking profitability in the English-speaking Caribbean. The ratings also reflect Republic Insurance’s ability to generate consistent earnings, reflecting its favorable loss experience and net premium growth. Republic Insurance’s total equity continues to increase as a result of the consistent operating earnings and lack of shareholder dividend payouts. On a risk-adjusted basis, the company maintains a more-than-adequate level of capitalization relative to its liability profile.
These strengths are partially offset by Republic Insurance’s limited business profile, as the majority of its net assumed premiums and earnings are generated from the reinsurance of credit insurance. However, the company is looking to expand its business profile with the reinsurance of mortgage term insurance beginning in 2017. An additional offsetting factor is the dependence of earnings and premiums originating in Trinidad and Tobago, which A.M. Best categorizes as having a modest level of country risk. The lack of geographic diversification is not expected to change over the medium term, as the new mortgage term business initially will be written in Trinidad and Tobago. While A.M. Best believes there is the potential exposure to heightened economic and political risks in the other countries Republic Insurance conducts business, A.M. Best notes there is only a modest amount of business being reinsured outside of Trinidad and Tobago.
This press release relates to Credit Ratings 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 see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.