OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” of CIBC Reinsurance Company Limited (CIBC Re) (Barbados). The outlook of these Credit Ratings (ratings) is stable.
CIBC Re is a life reinsurance subsidiary that is ultimately owned by the Canadian Imperial Bank of Commerce (CIBC). CIBC Re assumes credit insurance business that has been underwritten by unaffiliated life insurance carriers on consumer mortgages, loans and credit cards originated by CIBC’s Canadian branches. CIBC Re subsequently retrocedes a portion of these risks to two unaffiliated reinsurers. Formerly, CIBC Re participated in excess retrocession pools within the United States and Canada but has since exited the market through a series of novations and natural run-off.
The ratings reflect CIBC Re’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management. The company has a history of solid performance metrics and profitability and maintains a conservative investment portfolio composed entirely of high-quality, liquid and relatively short duration bonds. These positive rating factors are partially offset by CIBC Re’s dependence on consumer loan originations for premium growth, which have a potential to decline if consumer loan originations in the Canadian market slow.
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