A.M. Best Affirms Ratings Of Rembrandt
A.M. Best has affirmed the financial strength rating of A [Excellent] and the issuer credit rating of “a” of Rembrandt Insurance Company, Ltd. [Rembrandt] [Bermuda]. The outlook for both ratings remains stable.
A statement from the rating company said, “Rembrandt is a captive of Vitol Holding BV [Netherlands], a holding company of a group engaged principally in the trading of petroleum related products and commodities.
“The ratings of Rembrandt reflect the company’s strong financial performance and excellent risk-adjusted capitalisation, as well as its importance to the Vitol group as a risk management tool.
“Rembrandt consistently generates very strong operating results, as demonstrated by an average five-year adjusted return on capital of 17.9%. Its strong financial performance is driven by excellent underwriting results, with an average five-year combined ratio of 19.5%, and is supported by stable, albeit relatively low, investment income.
“The company’s risk-adjusted capitalisation remains excellent, underpinned by good internal capital generation and an outward reinsurance programme that is placed with a strong panel of reinsurers. A marginally offsetting factor is the loan facility provided by Rembrandt to the Vitol group, which represents 70% of total investments. However, the investment risk associated with this loan is somewhat mitigated by the loan terms, which allow the loan to be redeemed following a short notice period.
“A.M. Best believes that Rembrandt is well positioned at its current rating level. Negative rating actions could follow a prolonged period of weak underwriting results, as well as a significant deterioration in Rembrandt’s risk-adjusted capitalisation.”
