AM Best Affirms Legal & General’s Ratings
AM Best has assigned the Financial Strength Rating of A [Excellent] and the Long-Term Issuer Credit Rating of “a” [Excellent] to Legal & General Reinsurance Company No. 2 Limited. [L&G Re 2] [Bermuda]. The outlook assigned to these Credit Ratings is stable.
L&G Re 2 was established in 2021 and is ultimately owned by Legal & General Group Plc [L&G].
A statement from the ratings agency said, “The ratings reflect L&G Re 2’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management [ERM]. The ratings also factor in lift from L&G due to L&G Re 2’s importance to the group as a vehicle to compete and expand in pension risk transfer [PRT] markets outside the United Kingdom and United States, as well as the financial and operational support it receives from its parent.
“L&G Re 2’s balance sheet strength is underpinned by risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio [BCAR], that AM Best expects to be maintained at the strongest level through a forecast period of five years. L&G has provided the initial capital and is expected to support the company’s business growth.
“The adequate operating performance assessment considers the company’s five-year business plan. AM Best expects L&G Re 2 to grow its portfolio of Canadian PRT business gradually.
“The company is expected to benefit from L&G’s knowledge and expertise in the PRT business, as well as the group’s investment platforms and risk management oversight.“
