A.M. Best Affirms Credit Ratings of Humboldt Re Limited

LONDON--(BUSINESS WIRE)-- A.M. Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of Humboldt Re Limited (Humboldt Re) (Guernsey). The outlook of these Credit Ratings (ratings) remains stable.

The ratings reflect Humboldt Re’s strong risk-adjusted capitalisation, adequate risk management framework, and experienced management team. Offsetting rating factors include the company’s underwriting concentration in natural catastrophe reinsurance, and the high level of dependency on Credit Suisse’s Insurance-Linked Strategies team.

Humboldt Re is a privately owned start-up entity based in Guernsey that provides mainly short-tail property and specialty lines reinsurance. Since it started operating at the end of 2015, the company has derived all of its business solely using the distribution reach of Credit Suisse’s Insurance-Linked Strategies, a leading insurance-linked securities hedge fund, currently with assets under management of approximately USD 7.1 billion.

Humboldt Re’s risk-adjusted capitalisation is strong, as a result of moderate underwriting leverage, a flexible retrocession programme managed to minimise counterparty credit risk, and a relatively low-risk investment profile. Whilst the company remains reliant on Credit Suisse to source its business, Humboldt Re is on track to write gross written premium of approximately CHF 156 million for 2016. In addition, the company has implemented a risk management framework commensurate to its risk profile, accommodating its specific underwriting activities.

Current headwinds in the global reinsurance market continue to present challenges to Humboldt Re’s business plan. Although the company so far in 2016 has been able to secure top-line revenues above its original expectations, and is expected to report a profit for the year, underwriting margins and investment yields remain subject to the pressure of the current challenging operating environment.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2016 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.

View source version on businesswire.com: http://www.businesswire.com/news/home/20161103006504/en/

A.M. Best
Pablo Vasquez
Financial Analyst
+44 20 7397 0311
[email protected]
or
Ghislain Le Cam, CFA, FRM
Associate Director, Analytics
+44 20 7397 0268
[email protected]
or
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
[email protected]
or
Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
[email protected]

Source: A.M. Best

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