CORRECTING and REPLACING AM Best Places Credit Ratings of R&Q Insurance Holdings Ltd and Its Rated Subsidiaries Under Review with Negative Implications

LONDON--(BUSINESS WIRE)--First paragraph, second sentence of release should read: Concurrently, AM Best has placed under review with negative implications the Long-Term ICR of “bbb-” (Good) of R&Q Insurance Holdings Ltd (R&Q) (Bermuda) [AIM: RQIH], the non-operating holding company of the group (instead of: Concurrently, AM Best has placed under review with developing implications the Long-Term ICR of “bbb-” (Good) of R&Q Insurance Holdings Ltd (R&Q) (Bermuda) [AIM: RQIH], the non-operating holding company of the group).

The updated release reads:

AM BEST PLACES CREDIT RATINGS OF R&Q INSURANCE HOLDINGS LTD AND ITS RATED SUBSIDIARIES UNDER REVIEW WITH NEGATIVE IMPLICATIONS

AM Best has placed under review with negative implications the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” (Excellent) of Accredited Surety and Casualty Company, Inc. (ASC) (Orlando, FL), Accredited Specialty Insurance Company (ASI) (Phoenix, AZ) and Accredited Insurance (Europe) Limited (AIEL) (Malta). Concurrently, AM Best has placed under review with negative implications the Long-Term ICR of “bbb-” (Good) of R&Q Insurance Holdings Ltd (R&Q) (Bermuda) [AIM: RQIH], the non-operating holding company of the group. ASC, ASI and AIEL are wholly owned subsidiaries of R&Q.

The Credit Ratings (ratings) reflect R&Q’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.

The rating actions follow the announcement on 4 April 2023, that R&Q is reviewing strategic options to separate its program management and legacy insurance businesses, and that the group is expected to report a material operating loss for 2022. AM Best had previously considered ASC, ASI and AIEL (the Accredited companies) to be strategically important to the R&Q group and will now review the impact of the likely separation on their rating fundamentals. Furthermore, the expected operating loss for 2022, driven by R&Q’s legacy operations, will likely lead to a material weakening of the group’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR).

The ratings are expected to remain under review until AM Best has sufficient clarity over the rating fundamentals of the Accredited companies and the R&Q group, subsequent to their likely separation. It is considered probable that in the near future, the Accredited companies will form an independent rating unit, separate from R&Q.

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 specialising 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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