A.M. Best has affirmed the financial strength rating of “A- (Excellent)” and the long-term issuer credit rating of “a-“ for Humboldt Re, located in Guernsey.
Humboldt Re is a privately owned start-up entity that provides mainly short-tail property and specialty lines reinsurance.
Since its start-up in 2015, the company has derived all of its business solely using the distribution reach of Credit Suisse’s insurance-linked strategies, an insurance-linked securities hedge fund.
The ratings reflect Humboldt Re’s “strong” risk-adjusted capitalisation, “adequate” risk management framework, and “experienced” management team.
Factors offsetting these rating include the company’s underwriting concentration in natural catastrophe reinsurance, and the high level of dependency on Credit Suisse’s insurance-linked strategies team, according to A.M. Best.
The current global reinsurance market environment continues to present challenges to Humboldt Re’s business plan, but the ratings agency noted that Humboldt Re has been able to surpass its original expectations for 2016.
