AM Best Assigns Credit Ratings to Reaseguradora Delta, S.A.

MEXICO CITY--(BUSINESS WIRE)--AM Best has assigned a Financial Strength Rating of B++ (Good) and a Long-Term Issuer Credit Rating of “bbb” (Good) to Reaseguradora Delta, S.A. (Delta Re) (Panama City, Panama). The outlook assigned to these Credit Ratings (ratings) is stable.

The ratings reflect Delta Re’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The stable outlooks reflect AM Best’s expectations that Delta Re will maintain profitable results driven by prudent risk selection while successfully implementing its territorial expansion.

Delta Re’s very strong balance sheet strength recognizes the company’s adequately matched obligations and risk appetite, as well as its shareholders’ commitment to strengthening the company’s capital base, reflected in its strongest risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). The very strong assessment also recognizes the conservative profile of Delta Re’s investment portfolio and concentration in certificates of deposit.

The company’s operating performance is characterized as being profitable; positive bottom-line results have been achieved through technical results in all lines of business during 2021. While investment income contributes to Delta Re’s earnings, it is limited by the conservatism of the portfolio. AM Best expects Delta Re to maintain premium sufficiency levels while implementing its growth strategy.

Delta Re, founded in Panama in 2010, offers treaty and facultative reinsurance for several lines of business including fire, surety, construction and engineering, auto, marine aviation and transport, personal liabilities, robbery, personal accidents, and miscellaneous. The majority of its portfolio is composed of treaty contracts, approximately 81%, while facultative reinsurance accounts for 19%. Delta Re is diversified geographically, as the company underwrites premiums in Ecuador, Panama, Dominican Republic and Paraguay through distribution channels that include brokers and alliances with other reinsurers, as well as a managing general agent established in Miami by Delta Re’s shareholders. AM Best assesses the company’s business profile as neutral.

ERM is considered appropriate, as it is well-integrated into its operations; risk appetite and tolerance are well-defined, and the company takes advantage of its pricing model and management team, which has over 20 years of experience in Latin America’s market. The company has a sound excess of loss retrocession program in place with highly rated reinsurers with an excellent level of security.

Negative rating actions could occur if the company’s capital base erodes due to significant changes in dividend policy or a deterioration in operating results that would debilitate risk-adjusted capitalization to a point no longer supportive of the current assessment.

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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