AM Best Assigns Credit Ratings to Accelerant Re I.I.; Affirms Credit Ratings of Accelerant Holdings' Rated Subsidiaries

National Post

2 days ago

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OLDWICK, N.J. — has assigned a Financial Strength Rating (FSR) of A- (Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of 'a-' (Excellent) to Accelerant Re I.I. (ARPR) (Puerto Rico). The outlook assigned to these Credit Ratings (ratings) is stable. Concurrently, AM Best has affirmed the FSR of A- (Excellent) and the Long-Term ICRs of 'a-' (Excellent) of Accelerant Insurance Europe SA (AIE) (Belgium), Accelerant Insurance UK Limited (AIUK) (United Kingdom), Accelerant Specialty Insurance Company (ASIC) (Little Rock, AR), Accelerant National Insurance Company (ANIC) (Wilmington, DE), Accelerant Insurance Company of Canada (AIC) (Canada) and Accelerant Re (Cayman) Ltd. (ARKY) (Cayman Islands). The companies are wholly owned subsidiaries of Accelerant Holdings (Accelerant), a non-operating holding company in the Accelerant group. The outlook of these ratings is stable.
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The ratings reflect the consolidated balance sheet of Accelerant'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.
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In AM Best's view, AIE, AIUK, ASIC, ANIC, AIC, ARKY and ARPR are strategically important to, and integrated within, Accelerant. AIE, AIUK, ASIC, ANIC and AIC play key roles in the group's strategy of providing insurance capacity to managing general agents (MGA) in the United Kingdom, the European Union and North America. ARKY and ARPR are reinsurers and are strategically important to the group's reinsurance and capital management strategy. Accelerant's licensed (re)insurance carriers benefit from capital maintenance agreements with the holding company.
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Accelerant's balance sheet strength assessment is supported by consolidated risk-adjusted capitalization at the strongest level, as measured by Best's Capital Adequacy Ratio (BCAR), and further complemented by additional supportive qualitative and quantitative factors, such as adequate net underwriting leverage, favorable financial flexibility and its conservative investment strategy. Limiting factors include heavy reliance on reinsurance through its low retention; however, the group has a record of accessing reinsurance partners of excellent credit quality, and has significantly diversified its reinsurance panel since launch, reducing dependence on any single partner.
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The group is expected to achieve consistent positive results in the near-to-medium term now that sufficient operating scale has been achieved. Accelerant has been substantially growing its top-line premium since its incorporation, with the business provided by its partner MGAs running at healthy average loss ratios, as per expectations. Operating performance is supported by the group's agency business, which is the main contributor to the overall operating results. The group predominately sources its earnings from a steady distribution of commissions and fees, and the group's underwriting results continue to improve.
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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
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Michael Cantalino
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Senior Financial Analyst
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Jacqalene Lentz
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