SINGAPORE--(BUSINESS WIRE)--A.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of “a” of Energas Insurance (L) Limited (Energas) (Malaysia). The outlook for both ratings is stable.
Energas’ ratings reflect its strong capitalization, comprehensive reinsurance protection and role as the sole captive insurance carrier for its ultimate parent, Petroliam Nasional Berhad (Petronas), an integrated global oil and gas company. Full profit retention in the absence of dividend payments to Petronas has enabled Energas to grow its capital favorably since inception.
Energas’ financial performance is underpinned by its low operating cost structure and consistent investment profits.
Energas has a large investment portfolio comprising of solely cash and cash equivalents, providing a high level of liquidity and minimum investment risk exposure. Its comprehensive reinsurance program from a panel of high quality reinsurers limits Energas’ aggregate loss exposure.
Offsetting rating factors include claims volatility from a narrow scope of assumed risk and increased event retention, especially as premium rates in its main engineering line remain soft while insured values are increasing.
Energas is well-positioned at its current rating level.
Negative rating actions may arise from a material deterioration of Energas’ risk-adjusted capitalization due to a material repatriation of capital.
A.M. 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.
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:
• Alternative Risk Transfer (ART)
• Catastrophe Analysis in A.M. Best Ratings
• Evaluating Country Risk
• Evaluating Non-Insurance Ultimate Parents
• Risk Management and the Rating Process for Insurance Companies
• Understanding Universal BCAR
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.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2015 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.