AM Best Downgrades Credit Ratings of GIC Perestrakhovanie LLC and Maintains Under Review With Negative Implications Status

Business Wire

LONDON--(BUSINESS WIRE)--
AM Best has downgraded the Financial Strength Rating to B+ (Good) from B++ (Good) and the Long-Term Issuer Credit Rating to “bbb-” (Good) from “bbb” (Good) of GIC Perestrakhovanie LLC (Russia). Concurrently, AM Best has maintained the under review with negative implications status for these Credit Ratings (ratings).

The ratings reflect GIC Perestrakhovanie LLC’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management. The ratings also factor in rating lift due to the implicit and explicit support that GIC Perestrakhovanie LLC receives from its parent, General Insurance Corporation of India.

The rating downgrades reflect deterioration in GIC Perestrakhovanie LLC’s balance sheet strength due to heightened geopolitical, economic and financial system risk in Russia, where the company is domiciled and underwrites the majority of its business.

The ratings remain under review with negative implications as AM Best is closely monitoring the severity of the impact of sanctions, and the broader international response to the conflict in Ukraine, on Russia’s economy and financial system, and the subsequent consequences for the credit profile of GIC Perestrakhovanie LLC. Balance sheet and operational concerns include potential liquidity constraints and issues in recovering from reinsurers. Any deterioration in the ability or willingness of General Insurance Corporation of India to support GIC Perestrakhovanie LLC would likely result in a further downgrade.

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 specialising 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.