A.M. Best Assigns Ratings to RGA Americas Reinsurance Company, Ltd. and RGA Atlantic Reinsurance Company, Ltd.
A.M. Best has assigned a financial strength rating of A+ (Superior) and the issuer credit ratings of “aa-” to RGA Americas Reinsurance Company, Ltd (RGA Americas) and RGA Atlantic Reinsurance Company, Ltd (RGA Atlantic ) (both domiciled in Barbados). The outlook assigned to the ratings is stable.
The ratings reflect RGA Americas role as a key global subsidiary of Reinsurance Group of America, Incorporated (RGA) (St. Louis, MO) [NYSE:RGA], noting its anticipated strategic value to the group as a certified reinsurer. It is anticipated that RGA Americas will be re-domesticated from Barbados to Bermuda and RGA Atlantic will become a direct subsidiary of RGA Americas. Additionally, the ratings reflect the significance of its proforma consolidated operating profile, which is projected to represent approximately 40% of consolidated equity and 35% of pretax consolidated results. It is anticipated that RGA Americas and RGA Atlantic will play key roles in providing reinsurance solutions to external clients along with retrocession of business from other RGA entities. Additionally, the ratings reflect RGA Americas’ and RGA Atlantic’s adequate risk-adjusted capitalization, high credit quality investment portfolio and the strong level of integration within the consolidated group.
Offsetting rating factors include the highly competitive global reinsurance market, which continues to consolidate and reflects lower cession rates in the United States, along with recent adverse morbidity experience in its Asia Pacific business that is now stabilizing.
Positive rating movement for the near to medium term is unlikely. Key rating factors that could result in negative rating actions include a sustained decline in risk-adjusted capital and/or adverse trends in operating performance or a material decline in the strategic value of RGA Americas to its ultimate parent.
The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
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