AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Evergreen Insurance Company Limited (EICL) (Bermuda). The outlook of these Credit Ratings (ratings) is stable. The ratings reflect EICL’s balance sheet strength, which AM Best assesses as ‘very strong’, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management. EICL’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), remained at the strongest level, and is underpinned by a low net underwriting leverage, a highly conservative and liquid investment portfolio, and comprehensive reinsurance arrangements. According to AM Best, although the company’s capital and surplus has shown a ‘mild’ downward trend over the past three years due to dividend payouts to its parents (Evergreen International S.A. and Evergreen International Corp.), its BCAR remained at a robust level. AM Best expects the company to maintain a sufficient buffer in its risk-adjusted capitalisation to support its risk profile over the next three years. EICL has demonstrated a track record of strong underwriting and operating performance, due to its group-related business, AM Best says. The company’s net claims experience has been highly favourable over the past few years, while gross losses fluctuated due to a few major loss events in marine and aviation hull, AM Best adds. EICL faced investment headwinds during 2021 from its cash and deposit-only investment portfolio. AM Best expects that underwriting results, in particular for its marine business, will continue to be the main driver of its bottom-line results.
