AM Best has assigned a financial strength rating of B++ (Good), and a long-term issuer credit rating of “bbb+” (Good) to Patria Re US (Patria US).
The outlook assigned to these ratings is stable.
AM Best says the “ratings reflect Patria US’s balance sheet strength, which it assesses as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.”
The ratings also recognise Patria US’ affiliation to its ultimate parent, Peña Verde, S.A.B. (Peña Verde), a Mexican insurance and reinsurance company. The ratings also reflect the support received from its immediate parent, Reaseguradora Patria, S.A. (Patria Re), the lead company of the Peña Verde group and a reinsurer in Latin America.
AM Best considers Patria US a new company formation as it only began operations in February, after receiving authorisation to domicile in the US by the South Carolina Department of Insurance.
“Patria US’s balance sheet strength is at a ‘strong level’, with its capital base expected to strengthen under capital contributions planned for the upcoming years,” according to AM Best.
The ratings agency considers Patria US’s operating performance to be adequate. Patria US’s initial bulk of business consists of a diverse mix of premiums retroceded from Patria Re, with a profitable track record. AM Best expects that the small size of Patria US’ operation will help keep operating expenses stable.
Patria US shares all of the group’s comprehensive enterprise risk management (ERM) infrastructure and practices, as well as its shared management team. AM Best considers the company’s ERM assessment as appropriate for its risk appetite and as being ‘strongly supported’ by the holding company’s back office.
