A.M. Best has affirmed the financial strength rating of “A (Excellent)” and the issuer credit rating of “a” of Dorinco Reinsurance Company.
Dorinco is the captive reinsurance company of the Dow Chemical Company. The outlook for both ratings is stable.
In a recent release A.M. Best explained that Dorinco’s ratings reflect its continued strong operating performance, balanced risk profile and “excellent” risk adjusted capitalisation.
The ratings also consider Dorinco’s strategic importance within the Dow organisation and its successful mitigation of Dow’s worldwide, long-tail and volatile risks through its short-tailed uncorrelated non-standard auto reinsurance business.
“Partially offsetting these positive rating factors is Dorinco’s limited profile in the reinsurance market, which is a function of its hybrid captive nature.”
“Another offsetting factor is Dorinco’s exposure to Dow risks, many of which are worldwide and long tail in nature A.M. Best believes that Dorinco is well positioned at its current rating level,” said A.M. Best.
Factors that could lead to a downgrade of Dorinco’s ratings include, a decline in its risk-adjusted capitalisation, unfavourable operating profitability trends, or an outsized catastrophe loss.
Alternatively, factors that could lead to rating upgrades include continued favourable operating profitability trends coupled with improved risk-adjusted capital levels.
