AM Best Affirms Kuwait Reinsurance Company K.S.C.P Credit Ratings
AM Best has attested the Financial Strength Rating of A- (Excellent) as well as the Long-Term Issuer Credit Score Rating of "a-" of Kuwait Reinsurance Company K.S.C.P. (Kuwait Re) (Kuwait). The expectation of these Debt Ratings (ratings) continues to be stable.
The ratings reflect Kuwait Re's annual report strength, which AM Best categorises as very strong, along with its sufficient operating performance, neutral business profile and suitable enterprise risk management.
Kuwait Re's balance sheet strength is underpinned by risk-adjusted capitalisation at the best level, as measured by Best's Resources Competence Proportion (BCAR). The company's annual report strength likewise gains from prudent scheduling methods and adequate liquidity to support operations with liquid properties to net technical reserves of 102% at year-end 2019. Resources intake is driven mainly by financing risks, as a result of the business's ongoing leading line development in 2019 and also high premium retention.
Kuwait Re's concentrate on underwriting discipline has translated right into boosted technical performance over the last few years, decreasing historical volatility in operating results. The company has reported a healthy five-year average (2015-2019) incorporated proportion of 96.6%. Investment income has actually even more supported general profitability, adding to pre-tax profits of KWD 5.0 million in 2019 (2018: KWD 3.5 million), which translated to a return on equity of 9.3% for the year.
Kuwait Re's business profile is supported by its great geographical diversification, via procedures spanning the Middle East and also North Africa, Asia-Pacific as well as Central and also Eastern Europe. The underwriting portfolio is well-diversified by line of business, offering proportional and also non-proportional cover to its cedants. In 2019, Kuwait Re wrote gross written premiums of KWD 57.0 million, a 22.4% increase on 2018, with growth coming from the business's proportional profile, especially in the Indian subcontinent. Kuwait Re remains to update its underwriting strategy based upon market performance, meaning to maintain a well-balanced underwriting portfolio.
