The operating performance of Connecticut-headquartered General Reinsurance Corporation (Gen Re) should remain solidly supportive of its current assessment for the foreseeable future, despite continued headwinds from adverse inflationary trends, as well as the persistent challenge presented by climate risk, said AM Best.
Gen Re has a global footprint with a well-diversified platform by geography and product offerings, including an international reach in the P&C and life (re)insurance business segments. This diversification is reflected in the stability of the group’s underwriting results and overall operating performance during periods when the reinsurance industry is impacted by unusually high catastrophe losses, adds AM Best.
Gen Re’s operating performance continues to benefit from sound underwriting decisions that have allowed the company to take advantage of overall favourable market conditions in the P&C reinsurance space. Gen Re’s life (re)insurance operations continue to add a solid contribution to earnings, despite elevated mortality trends in certain geographies.
The group’s relatively high allocation to equity investments presents occasional investment-related earnings volatility, but the long-term performance of the group’s investment portfolio is strong.
Ratings affirmed
AM Best has affirmed the financial strength rating (FSR) of ‘A++’ (Superior) and the long-term issuer credit ratings (ICR) of ‘aa+’ (Superior) of Gen Re and its core property/casualty and life reinsurance subsidiaries.
Collectively referred to as Gen Re Group, these entities operate in the United States and internationally. The long-term ICR of ‘aa+’ (Superior) for Gen Re, a Delaware-based holding company, has also been affirmed. All ratings carry a ‘Stable’ outlook.
Strengths
The ratings reflect Gen Re’s balance sheet strength, which AM Best assessed as strongest, as well as its adequate operating performance, very favourable business profile and appropriate enterprise risk management. These positive rating attributes were enhanced further as a result of Gen Re being a wholly-owned subsidiary of Berkshire Hathaway, providing additional financial flexibility and investment expertise.
These strengths are bolstered by Gen Re’s position as a wholly owned subsidiary of Berkshire Hathaway, which provides additional financial flexibility and investment expertise.
Gen Re’s platform is supported by risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), which has remained consistently in line with its strongest overall balance sheet strength assessment. Solid underwriting results, supplemented by increasing net investment income continue to drive capital appreciation, despite the payment of dividends to Gen Re’s publicly traded parent, Berkshire Hathaway. Gen Re also maintains an extensive risk management programme that oversees all aspects of risk throughout its worldwide operations.
The FSR of ‘A++’ (Superior) and the Long-Term ICRs of ‘aa+’ (Superior) have been affirmed too for the following core (re)insurance subsidiaries:
- General Re Life Corporation
- General Reinsurance Australia Ltd.
- General Reinsurance Life Australia Ltd.
- General Reinsurance AG
- General Reinsurance Africa Ltd.
- General Star Indemnity Company
- General Star National Insurance Company
- Genesis Insurance Company