AM Best has affirmed the financial strength rating of ‘A’ (Excellent) and the long-term issuer credit rating of ‘a+’ (Excellent) of PMG Assurance Ltd. (PMG), based in Bermuda. The outlook of these credit ratings is ‘stable’. The ratings reflect the balance sheet strength of PMG, which the credit agency assesses as very strong, as well as its strong operating performance, limited business profile, and appropriate enterprise risk management (ERM). As the sole captive insurance company for its ultimate parent, Sony Group Corporation (Sony), PMG also receives rating enhancement due to its strategic importance to the group. According to AM Best, the captive’s risk-adjusted capitalisation is at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). This assessment is supported by excellent liquidity, low underwriting leverage, and a conservative investment strategy in support of the very strong balance sheet strength assessment. The strong operating performance is attributed to consistent results in PMG’s combined and operating ratios, which continue to outperform industry averages. These results stem from favourable underwriting outcomes and profitability with a low underwriting expense structure. While the captive is susceptible to volatility in earnings due to the low-frequency, high-severity nature of the risks it insures, AM Best notes that PMG maintains a comprehensive reinsurance programme in place for all coverage provided to its parent to mitigate exposures. PMG writes commercial property, marine, directors and officers, and cyber risk for Sony and its affiliates. It previously provided employee benefits insurance as well. As an integral component of the parent’s ERM, the captive’s role is to meet global insurance requirements while also providing risk management services to group members.
