AM Best Affirms Credit Ratings of Allianz Global Corporate & Specialty Resseguros Brasil S.A.

MEXICO CITY--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A+ (Superior) and the Long-Term Issuer Credit Rating of “aa” (Superior), of Allianz Global Corporate & Specialty Resseguros Brasil S.A. (AGCS Re Brazil) (São Paulo, Brazil). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect AGCS Re Brazil’s strategic importance as a subsidiary of Allianz SE (Allianz), which on a consolidated basis has a balance sheet strength that AM Best assesses as strongest, as well as its strong operating performance, very favorable business profile and appropriate enterprise risk management.

The stable outlooks reflect AM Best’s expectation that the group's balance sheet strength fundamentals will remain supportive of the strongest assessment level, underpinned by its risk-adjusted capitalisation being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), and supported by conservative capital management and excellent financial flexibility. The group is expected to remain one of the leaders in the global insurance market and continue to demonstrate stable and strong operating performance, supported by superior diversification by line of business and geography, as well as continued technical discipline.

Allianz is one of the world’s largest insurance groups, with superior diversification by geography and line of business, as well as leading positions in many developed and emerging markets, offering a complete range of life and non-life insurance products and asset management services. The group’s competitive position is supported by its scale, strong management capabilities, dynamic strategy and strong brand.

AGCS Re Brazil’s operations and management, which are fully integrated with Allianz, have demonstrated a track record of supporting the group’s strategy, providing access to Brazil’s reinsurance market as a local reinsurer. The group’s competitive advantages include the opportunity to expand in Latin America by serving as a regional hub with the potential for commercial and operational opportunities, as well as synergies with Allianz’s retail entities in Brazil, Argentina, Colombia and México. The company specializes in offering reinsurance coverages across a broad spectrum of categories in the life and property/casualty segments.

The group’s operating performance is characterized by consistently positive bottom-line results, derived from the company’s well-diversified business portfolio. Underwriting practices are sound, and benefit from the synergies provided by the group through the rest of Allianz’s financial entities, which have enabled AGCS Re Brazil to contain operating expenses.

AM Best expects the group’s risk-adjusted capitalization, as measured by BCAR, to remain supported by the intragroup excess of loss reinsurance contracts and its stop loss agreement. AGCS Re Brazil’s operations are clearly identified as part of the wider Allianz group and the Allianz Global Corporate & Specialty segment.

If there are negative rating actions on the main operating subsidiaries of Allianz, as a result of a weakening of balance sheet strength fundamentals, for example as a result of a decline in risk-adjusted capitalization, or a sustained deterioration of operating performance, the ratings of AGCS Re Brazil would mirror those same actions. Positive rating actions are unlikely in the near term. Over a longer term, positive rating actions could arise if Allianz outperforms its peers in terms of operating results for an extended period of time and demonstrates strengthening of its key rating fundamentals to a standard commensurate with a higher rating level. A change in AM Best’s perception regarding the strategic importance of AGCS Re Brazil to the group also could impact the company’s ratings.

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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