OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Ratings of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” of Fidelis Insurance Bermuda Limited (Fidelis) (Bermuda), Fidelis Underwriting Limited (United Kingdom) and Fidelis Insurance Ireland Designated Activity Company (Ireland). AM Best also has affirmed the Long-Term ICR of “bbb-” of Fidelis Insurance Holdings Limited (Bermuda), the ultimate holding company. Concurrently, AM Best has affirmed the Long-Term Issue Credit Rating of “bb” on Fidelis Insurance Holdings Limited’s preference shares. The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Fidelis’ balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
Fidelis maintains the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), a conservative loss reserve position, overall strong liquidity, a conservative investment platform and demonstrated adequate financial flexibility. Somewhat moderating the group’s balance sheet strength is its limited years in operation and dividends.
The group’s operating performance has been supported by very strong underwriting results and improving investment returns. Fidelis has generated improved underwriting performance over the past two years given its disciplined underwriting approach, experienced management team, adaptable business profile and economies of scale. Performance also benefits from earnings generated through Fidelis’ diversified business platform including its establishment of managing general agencies and a partnership with a special-purpose insurer. Fidelis’ investment returns benefited over the past 18 months from its revised investment strategy focused on holding the majority of its assets in fixed-income securities and cash and cash equivalents, with a small allocation to alternative investments. Prior to this decision, the group maintained the majority of its invested assets in alternative investments that experienced investment losses.
Fidelis is a global provider of specialty insurance and reinsurance products. While Fidelis is still in its start-up phase and is one of the newest companies formed in Bermuda, the group received strong acceptance by the market, as evidenced by its significant premium growth. The group has a strong senior management team with an excellent reputation and a proven track record.
AM Best considers Fidelis’ ERM as developed and appropriate for its overall business risk profile.
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