- Ocean RE reaffirms its credit rating from 2020 under the Best’s Credit Rating Methodology.
- The reinsurer ratings reflect the balance sheet strength of the company.
- The company’s expansion through America foresees significant growth potential in key markets.
On October 28th, 2021, AM Best awarded Ocean RE, the Barbados-based reinsurer, for the second consecutive year with the Financial Strength Rating of “A-” (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent). The outlook provided by these ratings indicates stable Credit Ratings within the parameters established by the agency and recognizes the disciplined underwriting by the company to deploy its capital with profitable results amid an unfavorable business cycle.
The company’s risk-adjusted capitalization remains at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), and has benefited from a capital contribution exceeding 110 million dollars, received at the beginning of 2020.
Ocean RE offers a diversified product mix which has led the company to exponential growth during the last two years, expanding its presence through Latin America and managing operations from Mexico, Colombia, Peru, and Panama. This expansion foresees significant growth potential in key markets and regions like the Middle East and North Africa, the Inter-African Conference on Insurance Markets (CIMA), and the Far East. Ocean RE has a specialized team in multiple insurance and reinsurance areas, with the necessary adaptability to meet the needs of international markets.
Among their services, the organization offers reinsurance programs that are fully funded to the projected ultimate losses of the company’s clients. Its business development strategy identifies an increase in the proportion of traditional reinsurance in its portfolio compared with its captive portfolio.
The operating performance resulted in positive net income in 2020 and 2021 due to appropriate levels of premium sufficiency derived from the nature of its captive business and an adequate retrocession program for expanding traditional reinsurance lines. So far, 2021 is a consolidating year, with the company presenting good results in new markets and successfully expanding its distribution channels.
“Due to the rating AM Best gave the organization, today Ocean RE can continue its operations worldwide and most importantly continue to grow its risk portfolio. Since expanding in this line of business is one of the main objectives the company targeted from the moment the capital merger became possible in 2020” explained Carlos Chamorro, Ocean Re’s CEO and Head of Global Operations.
The credit rating agency will continue to monitor the reinsurer’s balance sheet strength, particularly given its holding company’s influence due to its financial leverage and evolving corporate structure. These ratings reflect the company’s financial strength, which AM Best assesses as strongest, and its adequate operating performance, business profile, and appropriate enterprise risk management.
AM Best continues to be the leading rating agency for alternative risk transfer entities. AM Best fulfills the consulting function, guiding companies through improvement and adaptation processes for compliance with the revised requirements through Best’s Credit Rating Methodology, used to determine the ratings and grant permission for the continuity of their operations.