AM Best Upgrades Credit Ratings of CG United Insurance Ltd.; Affirms Credit Ratings for Most of Coralisle Group Ltd. Subsidiaries

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has upgraded the Financial Strength Rating (FSR) to A (Excellent) from A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “a” (Excellent) from “a-” (Excellent) of CG United Insurance Ltd. (CG United) (Barbados). The outlook of these Credit Ratings (ratings) has been revised to stable from positive. Concurrently, AM Best has affirmed the FSR of A (Excellent) and the Long-Term ICRs of “a” (Excellent) for the life/health (L/H) and property/casualty (P/C) operating subsidiaries of Coralisle Group Ltd. (CG). The outlook of these ratings is stable. CG is a wholly owned intermediate holding company of Edmund Gibbons Limited, the ultimate parent company. All companies are domiciled in Bermuda, unless otherwise specified. (See below for a detailed listing of these companies.)

The ratings reflect CG’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

On a consolidated basis, CG continues to demonstrate the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), supported by ample liquidity and fungibility of resources across the organization. Financial leverage was moderate in 2022, after the acquisition of CG United in May of 2022, which was partially financed with debt. This debt was fully repaid in 2023. Reinsurance capacity was severely constrained going into 2023, which drove an increase in retentions on proportional treaties. To secure appropriate excess of loss limits given the additional retentions, higher excess of loss deductibles were accepted.

These, combined with much higher property exposure after the CG United acquisition, materially increased reinsurance dependence. However, AM Best believes the program remains supportive of the overall balance sheet assessment.

CG’s year-end 2022 results were materially impacted by adverse investment results that more than offset otherwise favorable operating results. Despite the adverse net results in 2022, CG has reported consistent favorable operating and net results over the last five years driven by health and P/C lines. Reported premium growth has been strong over the last five years, and especially strong in 2022, as CG closed on its acquisition of CG United in May and included associated premiums for seven months. Growth in 2023 is expected to be strong with full year CG United results as large rate increases are realized throughout the property portfolio. Potential for volatility in earnings remains high due to catastrophe exposure and the risk of significant health reform in Bermuda.

The ratings of CG United reflect its increased strategic importance to CG and its substantially complete integration with the legacy business. This integration includes the rebranding of CG United in 2022, combined with reinsurance purchasing, the licensing of CG United entities to sell CG health products and cost synergies related to consolidation of core systems and processes.

The FSR of A (Excellent) and the Long-Term ICRs of “a” (Excellent) have been affirmed with stable outlooks, for the following subsidiaries of Coralisle Group Ltd.:

• Coralisle Insurance (BVI) Ltd. (British Virgin Islands)
• British Caymanian Insurance Company Limited (Cayman Islands)
• Coralisle Insurance Company Ltd.
• Coralisle Life Assurance Company Ltd.
• Coralisle Medical Insurance Company Ltd.
• CG Atlantic Medical & Life Insurance Ltd. (Bahamas)
• CG Atlantic General Insurance Ltd. (Bahamas)

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.

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