AM Best upgrades the Financial Strength Rating to 'A+' (Superior) from 'A' (Excellent), and the Long-Term Issuer Credit Ratings to 'aa-' (Superior) from 'a+' (Excellent), of Solen Versicherungen (SVAG) of Switzerland and Noble Assurance Company of Texas, US. The outlook on the ratings is stable. The ratings reflect SVAG's balance sheet strength, which AM Best assesses as very strong, alongside its strong operating performance, neutral business profile and appropriate enterprise risk management. They also factor in rating lift from parent company Shell. The upgrade reflects increased rating lift, recognising SVAG's strategic importance to the group as a well-entrenched risk management tool. SVAG serves as Shell's principal captive, writing offshore and onshore property and liability risks and associated business interruption cover core to the group's operations, as well as life business derived from the reinsurance of the group's pension liabilities. SVAG's balance sheet strength is underpinned by risk-adjusted capitalisation at the strongest level, as measured by Best's Capital Adequacy Ratio (BCAR). AM Best expects the captive's BCAR scores to remain above the minimum required for the strongest assessment. The assessment also factors in a concentration of assets in intragroup investments and the large gross and net line sizes the captive offers relative to its capital base. SVAG records a five-year (2021 to 2025) weighted average combined ratio of less than 25 per cent, though prospective underwriting performance is subject to volatility given exposure to high-severity, low-frequency losses and elevated market risk from managing the group's foreign currency warehousing activities. Noble holds its ratings as a member of the SVAG rating unit and a Shell subsidiary. Domiciled in Texas, Noble underwrites Shell's US business and cedes 100 per cent of its risks to sister company SVAG through a quota share reinsurance agreement.
