A.M. Best has affirmed the financial strength rating of A- (excellent) and the long-term issuer credit rating of “a-” of INPEX Insurance (Bermuda). The outlook of these credit ratings is stable.
The ratings also reflect INPEX Insurance’s role within the insurance purchase strategy and corporate risk management of its parent, INPEX Corporation.
INPEX Insurance provides coverage that mainly consists of property damage, third-party liability and operator’s extra expenses for its parent, its affiliates and joint-venture companies.
Low underwriting leverage and conservative investment portfolio are the reason for INPEX Insurance’s very strong balance sheet strength assessment.
Underwriting results over the most recent five-year period have been consistently positive, despite some volatility in the loss and combined ratios.
The negative rating factors are somewhat mitigated by the company’s favourable geographic spread of risk, prudent underwriting, and a robust reinsurance programme that has conservative retention and limits.
If INPEX Insurance continues to maintain its very strong balance sheet strength, along with more stable underwriting and operating results, A.M. Best suggested positive rating actions could occur.
However, negative rating actions could occur if there is a substantial increase in losses caused by a material shift in risk appetite or significant erosion of capital. Also, significant deterioration in INPEX’s credit profile could put downward pressure on INPEX Insurance’s ratings.