AM Best Affirms Credit Ratings Of SiriusPoint

April 5, 2022 | 0 Comments

AM Best has affirmed the Financial Strength Rating of A- [Excellent] and the Long-Term Issuer Credit Ratings  of “a-” [Excellent] of the rated operating subsidiaries of SiriusPoint Ltd.

Additionally, AM Best has affirmed the Long-Term ICR of “bbb-” [Good] of SiriusPoint, which is a non-operating holding company. Concurrently, AM Best has affirmed the Long-Term Issue Credit Rating of “bbb-” [Good] on the USD 115 million, 7% senior unsecured notes, due 2025, of SiriusPoint. The outlook of these ratings is stable.

The ratings agency said, “The ratings reflect SiriusPoint’s consolidated balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The ratings of the group’s operating subsidiaries factor in their strategic importance to SiriusPoint.

“SiriusPoint’s balance sheet strength is underpinned by its consolidated risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio [BCAR], which is expected to remain at the strongest level. The assessment also considers SiriusPoint’s good financial flexibility as a listed entity on the New York Stock Exchange, its reducing catastrophe exposure, and its good liquidity. Partially offsetting rating factors include the group’s relatively high, albeit reducing, exposure to alternative investments, and its somewhat limited capital fungibility due to a significant portion of consolidated available capital being held as a Safety Reserve in the group’s Swedish subsidiary.

“AM Best expects SiriusPoint’s operating performance to be adequate over the underwriting cycle, supported by actions taken by management to improve technical results. Actions taken include re-underwriting the portfolio, as well as rebalancing the business mix away from catastrophe-exposed property business and toward less volatile accident and health and specialty lines, and fee-based income. Prospective technical results are expected to be more stable, with combined ratios lower than the 109.4% reported in 2021 [as calculated by AM Best]. AM Best will monitor closely the execution of the group’s business plan.

“SiriusPoint’s neutral business profile assessment reflects its market position as a mid-tier global reinsurer, with a growing insurance portfolio, which operates from platforms in Europe, the United States, Bermuda and at Lloyd’s. The group has a good level of diversification by line of business, which is expected to improve further with its continued expansion into accident and health and selected specialty and casualty lines of business. Additionally, growth within the Insurance and Services segment is expected, supported by strategic partnerships with new and innovative managing general agents.

“The FSR of A- [Excellent] and the Long-Term ICRs of “a-” [Excellent] have been affirmed, with stable outlooks for the following subsidiaries of SiriusPoint Ltd.:

“SiriusPoint America Insurance Company
“SiriusPoint Bermuda Insurance Company Ltd.
“SiriusPoint International Insurance Corporation [publ]
“SiriusPoint Specialty Insurance Corporation”

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