OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of M&C General Insurance Company Limited (M&C General) (Castries, St. Lucia). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect M&C General’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management (ERM).
M&C General’s balance sheet strength reflects its risk-adjusted capitalization being assessed at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), which has been supported by steady annual surplus growth in excess of dividend payments to shareholders. However, this assessment is partially offset by the company’s relatively small surplus size, with less than USD 10 million in equity, and high dependence on reinsurance. Similar to its regional peers, the company relies heavily on the strength of its reinsurers to manage its catastrophe exposure, minimize earnings volatility and protect surplus. M&C General’s operating performance historically has been better than average when compared with other Caribbean-based insurers with similar product suites. Despite a concentration of risk in St. Lucia’s property and auto segments, the company’s operating performance has not been impacted by severe weather events over the past five years.
M&C General is well-established in its domestic market, which is considered highly competitive with limited potential for organic growth. The company’s ERM program has identified underwriting, investment and operational risks effectively, and has addressed the regulatory and legal environment, as well as reserving, marketing and reputational risks. Moreover, M&C General’s affiliation with its ultimate parent, Goddard Enterprises Limited, one of the largest Barbados-domiciled conglomerates, affords the company access to financial and investment management and information technology.
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