Sura Re Limited Achieves Stable Credit Ratings from AM Best

Sura Re Limited’s Credit Ratings Affirmed by AM Best

MEXICO CITY-- AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb” (Good) for Sura Re Ltd. (Sura Re). These ratings reflect a stable outlook, showcasing the company’s strong performance and financial stability.

Understanding Sura Re’s Financial Strength

The ratings are indicative of Sura Re’s robust balance sheet strength, which AM Best categorizes as very strong. The company has demonstrated adequate operating performance alongside a limited business profile and effective enterprise risk management (ERM) practices.

The Role of Sura Re

Sura Re serves as a captive reinsurer for Suramericana S.A. (Sura), a notable insurance group based in Colombia, which is predominantly owned by Grupo de Inversiones Suramericana S.A. Formed in Bermuda as a Class 3A insurer in late 2015, Sura Re obtained approval to function as a Class C insurer in mid-2022. Its principal aim is to engage in property business underwritten by Sura’s affiliates throughout Latin America, thereby fulfilling the group’s strategic objectives across the region.

Capital Adequacy and Risk Management

AM Best's evaluation of Sura Re's balance sheet strength considers its risk-adjusted capitalization as measured by Best’s Capital Adequacy Ratio (BCAR), finding it more than suitable for the risks the company maintains. As Sura Re progresses in executing strategic objectives and takes on more risk, capital requirements are anticipated to escalate, while it continues to uphold robust risk-adjusted capitalization. The company adopts a conservative investment policy aimed at maintaining liquidity for its obligations across various tenures and currencies.

Operational Performance Insights

In the most recent reporting period, Sura Re has achieved positive financial results for the fifth consecutive year since its inception. This operational success is driven primarily by favorable technical outcomes, stemming from effective underwriting practices and consistent fee income generation. As AM Best evaluates the broader macroeconomic landscape, it remains attentive to how these conditions might influence the company's investment performance.

Outlook and Future Considerations

While no immediate positive rating actions are anticipated, AM Best has indicated that downgrades could occur should Sura Re fail to meet its financial targets or if capital conditions worsen due to resulting decisions or poor macroeconomic conditions. Therefore, maintaining a focus on prudent risk management will be crucial as the company continues to develop its operations.

About AM Best

AM Best stands as a leading agency in ratings for alternative risk transfer entities, boasting a portfolio of over 200 rated companies globally. Their rigorous rating system and independent data continue to provide valuable insights into the insurance market. The ratings can be viewed on AM Best’s official site.

Frequently Asked Questions

What is Sura Re Ltd.?

Sura Re Ltd. is a captive reinsurer operating under Suramericana S.A., serving mainly the Latin American market.

What Credit Ratings were affirmed by AM Best?

AM Best affirmed Sura Re's Financial Strength Rating of B++ and Long-Term Issuer Credit Rating of “bbb”.

What factors influence Sura Re's ratings?

The company’s balance sheet strength, operating performance, and enterprise risk management are critical factors in determining its ratings.

How has Sura Re performed financially?

Sura Re has reported positive net profits for five consecutive years, showcasing its effective operational strategies.

What is AM Best's role in the insurance industry?

AM Best is a global credit rating agency that specializes in insurance, providing ratings, research, and analytics.

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