AM Best Affirms Credit Ratings of Eureka-Re SCC

MEXICO CITY--(BUSINESS WIRE)--
AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” (Good) of Eureka-Re SCC (Eureka) (Barbados). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Eureka’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

The stable outlooks reflect AM Best’s expectation that Eureka’s business strategy will lead to more-stable financial performance in upcoming years; in particular, the company’s operating performance.

Eureka, established in Barbados in 2009, is a Latin American regional reinsurer. The company underwrites mostly lower layers of facultative programs, originated through managing general agents. While most of premium taken by the company is sourced from Latin America, the company has diversified internationally, underwriting almost half of its business outside the region. Eureka’s business profile is assessed as neutral, recognizing the company’s evolving geographical diversification and its capacity to take risks; AM Best will continue to monitor the company’s performance in newer territories and assumed risks.

AM Best assesses Eureka’s balance sheet strength at the strongest level, as the availability and quality of its capital are well-positioned against the company’s risk profile. The company is subject to catastrophe-related losses, and as a result, has adjusted its retentions according to its experience, with a high quality panel of reinsurers. Investments are set to match insurance obligations, with a proprietary portfolio aimed to achieve yield and develop business opportunities, AM Best will continue to monitor those investments and its impact on the risk-adjusted capitalization of the company.

AM Best assesses Eureka’s operating performance as adequate, as the company sustained profitable performance in 2021 through its technical capacities, supported by its investment income. Such results reflect the continuous adjustments in underwriting and retentions that adapt to the evolving business landscape. AM Best will remain vigilant in monitoring the company’s performance and continued implementation of its strategy in 2022, as economic activity continues to recover in the region.

Negative rating actions could take place if volatility in Eureka’s operating performance affects the bottom-line results of the company, and ultimately, its risk-adjusted capitalization. Negative rating actions also could occur if the equity focused investment strategy pressures risk-adjusted capitalization of the company to levels not supportive of the current ratings.

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

For more information, visit www.ambest.com.

Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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Elí Sánchez

Associate Director

+52 55 1102 2720, ext. 122

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Alfonso Novelo
Senior Director, Analytics

+52 55 1102 2720, ext. 107

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Christopher Sharkey
Manager, Public Relations

+1 908 439 2200, ext. 5159

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Jim Peavy
Director, Communications

+1 908 439 2200, ext. 5644

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Source: AM Best