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FOR IMMEDIATE RELEASE
LONDON - JANUARY 09, 2017 08:44 AM (EST)
A.M. Best has assigned a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of “a” to CCR RE (France). The outlook assigned to these Credit Ratings (ratings) is stable.
The creation of CCR RE by Caisse Centrale de Réassurance (CCR) serves to segregate CCR’s open-market reinsurance activities from its French state-backed reinsurance operations, following a portfolio transfer from CCR to CCR RE on 31 December 2016. CCR RE, a fully owned subsidiary of CCR, has been established to underwrite the CCR group’s open market business from January 2017, covering life, non-life, and a number of specialty lines internationally.
A.M. Best anticipates that CCR RE’s portfolio will continue to contribute a material amount of premium to CCR on a consolidated basis, with the group’s open-market segment accounting for EUR 418.7 million of CCR’s EUR 1,287.2 million total gross written premium in 2015. CCR has a long-standing profile in the international market, alongside its domestic state-backed business, which CCR RE is expected to benefit from, inheriting a diverse portfolio by line of business and geography.
CCR RE’s ratings factor in its strategic importance to the CCR group, as an outlet to keep abreast of market developments and to maintain an active presence in segments in which the need for state support may arise. CCR RE is also deemed as strongly integrated into CCR, sharing transversal resources and leveraging the organisation’s existing governance and risk management frameworks.
The ratings of CCR RE also consider the company’s solid standalone risk-adjusted capitalisation and good business profile, which benefits from the long-established CCR brand. A.M. Best expects CCR RE to generate robust earnings, albeit driven by investment returns, considering that over the past four years, CCR’s open-market portfolio has produced underwriting losses. Whilst A.M. Best notes that CCR RE’s immediate focus will be on rationalising its underwriting portfolio and diversifying its natural catastrophe exposures, this may prove challenging considering the prevailing market conditions, and A.M. Best will continue to monitor the company’s progression against its business plan.
This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
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