AM Best has revised the outlook of the long-term issuer credit ratings (ratings) of QBE Insurance Group’s key operating subsidies from negative to stable.
AM Best has also affirmed the Financial Strength Rating of A- (Excellent) and the long-term issuer credit rating of (“a+)” (Excellent) of the subsidiaries.
The subsidies of the Australia-headquartered firm include QBE Europe, QBE UK Limited and QBE North America, including its pooled members.
AM Best’s revision of the ratings outlook reflects improvements in QBE’s underwriting and operating performance metrics.
QBE reported improved combined ratios of 94 per cent in 2022 and 93 per cent in 2021, which compares favourably with weaker underwriting returns in 2020 of 104.1 per cent.
In addition to this, overall QBE’s operating returns have strengthened. AM Best expects recent performance improvements to be sustainable over the underwriting cycle — supported by QBE’s actions to enhance performance and increase the resilience of its earnings.
QBE’s balance sheet strength assessment is underpinned by consolidated risk-adjusted capitalisation at the strong level as of year-end 2022, as measured by Best’s Capital Adequacy Ratio.
AM Best also expects QBE’s prospective risk-adjusted capitalisation to remain resilient to challenging operating conditions and underwriting portfolio growth. QBE’s balance sheet strength assessment is also supported by the group’s conservative and liquid investment portfolio and financial flexibility, as a regular capital markets participant.
AM Best says: “QBE’s favourable business profile assessment reflects its excellent geographic diversification and strong competitive positions in its core markets, with an established focus on commercial lines insurance.”
