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FOR IMMEDIATE RELEASE
OLDWICK - MARCH 10, 2017 01:13 PM (EST)
A.M. Best has downgraded the Financial Strength Rating (FSR) to B (Fair) from B++ (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “bb” from “bbb” of Gulf Insurance Limited (Gulf) (Trinidad). The outlooks for these Credit Ratings (ratings) have been revised to negative from stable.
The rating actions reflect A.M. Best concerns surrounding the macroeconomic and fiscal challenges faced by Gulf’s parent, Assuria N.V. (Assuria), and the potential financial strain that may be placed on Gulf and its balance sheet. These rating actions also consider the political, economic and financial challenges in Assuria’s home domicile of Suriname and A.M. Best’s concern over the potential adverse impact on Gulf as a result of Assuria’s weakened financial position.
Aside from the aforementioned concerns, Gulf maintains supportive stand-alone capitalization and benefits from being domiciled in Trinidad and Tobago and the regulatory safeguards provided by the Central Bank of Trinidad and Tobago. Gulf is a long-standing insurer in Trinidad and Tobago, having operated in this market for over 30 years and garnering a high level of brand recognition. Gulf’s core markets however, have become increasingly competitive to other regional markets.
Gulf is a multi-line property and casualty insurer operating in several Caribbean markets with its main operating presence in Trinidad and Tobago. As such, catastrophic events represent a significant level of risk exposure to Gulf and other regional insurers. This is mitigated through geographic diversification and the use of reinsurance. While recent year results have improved, Gulf’s underwriting and overall results prior to 2014 have been inconsistent, primarily due to significant write-offs associated with receivables from its prior ownership group.
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.
A.M. Best is the world’s oldest and most authoritative insurance rating and information source.