SINGAPORE--(BUSINESS WIRE)--A.M. Best has upgraded the issuer credit rating (ICR) to “bb+” from “bb” and affirmed the financial strength rating (FSR) of B (Fair) of Asian Reinsurance Corporation (Asian Re) (Thailand). The outlook for the FSR has been revised to positive from stable while the outlook for the ICR remains positive.
The ICR upgrade recognizes the continued initiatives to strengthen Asian Re’s capital, which have restored the company’s capital position and significantly reduced the risk of adverse development from outstanding Thai flood claims. Asian Re’s event retentions are small relative to its strengthened capital base and its risk-adjusted capitalization is well supportive of its ratings.
Offsetting rating factors include transfer restrictions on deposits that represent a substantial proportion of its capital. While the company has been able to maintain positive underwriting results after 2012, managing expenses against significantly reduced business volumes is a key challenge.
Removal of transfer risk on the company’s deposits and continued improvement in underwriting performance could result in positive rating action.
A significant deterioration in Asian Re’s capital position from catastrophe losses could result in downward pressure to the 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.
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.