AM Best shifts Hamilton Re outlook to positive on diversification efforts
Hamilton subsidiaries Bermuda-based Hamilton Re and Dublin-based Hamilton Insurance Designated Activity Company have secured a positive outlook from ratings agency AM Best, thanks to their diversification efforts and the favorable rate environment, despite not achieving underwriting profitability thus far.
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of A- of Hamilton Re and Hamilton Insurance DAC.
The agency’s view is supported by Hamilton’s investment returns and a favorable trend in underwriting results more recently, although the group has not yet achieved underwriting profitability, it said.
AM Best noted that the underwriting improvements have stemmed from the group’s diversification efforts and the favorable rate environment, as well as the re-underwriting measures taken on the casualty book of business and the completed integration of the Pembroke acquisition.
The business' risk management capabilities are considered appropriate and in line with the group’s risk profile.
The positive outlooks reflect AM Best’s expectation that " Hamilton will maintain its improving trend of profitability and continue generating earnings that are accretive to the group’s balance sheet strength."
It noted that positive rating actions could result if the group continues to display an improving trend of underwriting profitability, along with continued stable and accretive investment performance, thereby lessening the performance volatility that has weighed on the balance sheet strength assessment.
Conversely, the ratings could be affected negatively by turmoil in the capital markets that severely impacts the group’s risk-adjusted capitalization or investment performance.
“We’re proud of this accomplishment and the recognition from A.M. Best,” said Pina Albo (pictured), CEO of Hamilton. “Their endorsement is evidence that Hamilton is delivering on its strategy of building a global, diversified specialty insurance and reinsurance company.”
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