AM Best Affirms Credit Ratings Of BF&M Limited
AM Best has affirmed the Financial Strength Rating [FSR] of A [Excellent] and the Long-Term Issuer Credit Ratings [Long-Term ICR] of “a” of BF&M Life Insurance Company Limited, BF&M General Insurance Company Limited, and Island Heritage Insurance Company, Ltd.
Furthermore, AM Best has affirmed the FSR of A- [Excellent] and the Long-Term ICR of “a-” of Insurance Corporation of Barbados Limited [ICBL] [Barbados]. AM Best also has affirmed the Long-Term ICR of “bbb” of the parent company, BF&M Limited [BF&M]. All companies are domiciled in Hamilton, Bermuda, unless otherwise stated. The outlook of these Credit Ratings [ratings] is stable.
The ratings agency said, “The ratings of BF&M Life, BF&M General and Island Heritage reflect the companies’ balance sheet strength, which AM Best categorizes as strongest, as well as their adequate operating performance, neutral business profile and appropriate enterprise risk management [ERM].
“BF&M manages its health, life and property lines with a strong level of capital in support of its current business. Consistent favorable net gains from its diversified and geographically disbursed products has contributed to long-term shareholder equity growth.
“The core operating results from its Bermuda business in 2018 was a favorable offset to the higher reinsurance costs in the property/casualty business in the Cayman Islands, and in 2019, AM Best anticipates that it will also offset losses in the Bahamas resulting from Hurricane Dorian. BF&M’s significant catastrophe reinsurance protection and its approach to risk management also contributed to mitigating financial impact to the group. While the company has provided loss estimates for Hurricane Dorian, AM Best will continue to monitor incurred gross and net losses to confirm the effectiveness of the group’s catastrophe risk management.
“BF&M has solid market share in nearly all of its lines of business and is the second largest health insurer in Bermuda. Recent developments in local policy are affecting this market. AM Best also will monitor the outcomes of Bermuda’s regulatory changes stemming from the island’s health reform, where the government has legislated changes to how services delivered by the Bermuda Hospital Board [BHB] are funded and any potential impact this could have on BF&M’s health business. The island’s current fee-for-service model will be replaced by a set grant paid directly by the government to the BHB and the health system will have to manage costs to this.
“The ratings of ICBL reflect its balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, limited business profile and appropriate ERM.”
