OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has commented that the Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb” of Global Indemnity Limited (GLBI) [NASDAQ: GBLI] (Cayman Islands), and the Financial Strength Rating of A (Excellent) and the Long-Term ICRs of “a” of Global Indemnity Reinsurance Company Ltd. (Global Re) (Hamilton, Bermuda) and its U.S.–based affiliates remain unchanged following the termination of their internal reinsurance structure. The outlook of these Credit Ratings (ratings) remains stable.
GLBI recently terminated on a run-off basis the internal quota share between Global Re and its six U.S.-based affiliates effective Jan. 1, 2018, and Global Re is no longer covering any business written on or after Jan. 1, 2018. All reinsurance liabilities on policies incepted prior to Jan. 1, 2018, will remain with Global Re based on the reinsurance provided to its affiliates during those respective periods.
A.M. Best has determined that, although the change in reinsurance is material to A.M. Best’s view on explicit support provided, the effect of this change does not alter its view of each company’s strategic importance to the group, the inter-connectivity among its affiliates, and the overall ability and willingness among companies to support its member affiliates, if needed. This view also considers the significant explicit support still being provided by Global Re on business reinsured prior to Jan. 1, 2018. Lastly, A.M. Best takes into consideration the impetus for change and management’s desire to optimize its net tax efficiencies in response to the recent Tax Cuts and Jobs Act of 2017.
A.M. Best will continue to monitor the progress of these modifications and evaluate any developments and implications for impact on the ratings.
The U.S. affiliates include:
- American Reliable Insurance Company
- Diamond State Insurance Company
- Penn-America Insurance Company
- Penn-Patriot Insurance Company
- Penn-Star Insurance Company
- United National Insurance Company
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. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.
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