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A.M. Best Affirms Credit Ratings of Dorinco Reinsurance Company


CONTACTS:

Guilherme (Guy) Monteiro Simoes
Senior Financial Analyst
+1 908 439 2200, ext. 5301
guy.simoes@ambest.com

Greg Reisner
Director
+1 908 439 2200, ext. 5224
greg.reisner@ambest.com

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - OCTOBER 03, 2017 09:08 AM (EDT)
A.M. Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” of Dorinco Reinsurance Company (Dorinco) (Midland, MI), which is the captive reinsurance company of The Dow Chemical Company (Dow). The outlook of these Credit Ratings (ratings) remains stable.

Dorinco is a wholly owned subsidiary of Liana Limited, which is ultimately a wholly owned subsidiary of The Dow Chemical Company (Dow). Dorinco was created to assist Dow to efficiently manage its risks. Dorinco issues direct property and liability insurance policies to Dow and certain related companies, and participates in property and casualty reinsurance treaties covering Dow or unrelated parties with other insurance companies.

Dorinco continues to deliver strong combined ratios, positive net income and adequate risk-adjusted capitalization while maintaining a conservative investment portfolio and a prudent approach to underwriting. Dorinco’s risk profile remains diversified through its short-tail uncorrelated third-party reinsurance business and the longer-tail exposure associated with its Dow business.

Dorinco’s strategy is to maintain a diversified book of business with a focus on stable financial performance, profitability and low volatility. Dorinco has developed a solid third-party business while continuing to provide Dow with access to the insurance market.

Partially offsetting these positive rating factors is Dorinco’s limited profile in the reinsurance market, which is a function of its hybrid captive (re)insurer nature. Another offsetting factor is Dorinco’s exposure to Dow’s risks, many of which are long-tailed and natural catastrophe exposed.

Factors that could lead to positive ratings action include a continued and profitable operating performance, an enhancement of Dorinco’s profile in the reinsurance market and a continued improvement in the risk-adjusted capitalization.

Key drivers that could lead to negative ratings action are unfavorable operating profitability trends, significant catastrophe or investment losses, a significant decline in risk-adjusted capitalization or loss of parental support.

A.M. Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

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. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source.


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AMB# Company Name
003771 Dorinco Reinsurance Company
058356 Dow Chemical Company