AM Best Revises Outlooks to Positive for First Net Insurance Company

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)--
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” (Good) of First Net Insurance Company (First Net) (Guam).

The Credit Ratings (ratings) reflect First Net’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 revision of First Net’s outlooks to positive from stable reflect its consistently strong operating performance, which compares favorably to the composite average, and is supported by a steady stream of net investment income and generally favorable underwriting results. In 2023, the company experienced a significant weather event, Typhoon Mawar, which was the most severe weather event in Guam since 2002. Despite this event, First Net reported operating income for that year and the company’s five-year average combined ratio continues to compare favorably to the composite by almost 12 points. First Net reported pretax operating and net incomes in each of the last nine years and is on track to do so again in 2024.

The very strong balance sheet assessment is supported by the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), which is expected to remain consistent. The limited business profile assessment reflects the narrow scope of operations concentrated in Guam with modest exposure on Saipan and other islands throughout Micronesia. AM Best assesses First Net’s ERM program as appropriate, which includes a comprehensive reinsurance program that mitigates the impact of severe weather events, as demonstrated with Typhoon Mawar in 2023.

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.