Positive ratings for GAIL from AM Best

AM Best has revised the outlook to positive from stable for the long-term issuer credit rating (Long-Term ICR) and affirmed the financial strength rating (FSR) of A (Excellent) and the Long-Term ICR of “a” (Excellent) of Bermuda-based Group Ark Insurance Limited (GAIL). The outlook of the FSR is stable. 

GAIL is a wholly owned subsidiary of Ark Insurance Holdings, the non-operating holding company of the Ark group. Concurrently, AM Best has revised the outlook to positive from stable for the Long-Term Issue Credit Ratings (Long-Term IRs) on GAIL’s outstanding rated instruments and affirmed the Long-Term IRs. See below for a detailed listing of Long-Term IR ratings.

The positive outlook of the Long-Term ICR reflects AM Best’s expectation that Ark will maintain its profitability at a level commensurate with a strong operating performance assessment, supported by effective cross-cycle underwriting management.

According to AM Best the ratings reflect Ark’s consolidated balance sheet strength, which it assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM). In addition, the ratings reflect GAIL’s strategic importance to Ark, as the group’s Bermuda-based re/insurance vehicle. GAIL provides reinsurance to Ark’s corporate member at Lloyd’s and writes third-party re/insurance business.

Ark’s balance sheet strength is underpinned by consolidated risk-adjusted capitalisation being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). Ark’s risk-adjusted capitalisation is projected to remain at this level, supported by good internal capital generation. The balance sheet strength assessment also considers Ark’s prudent reserving, low risk investment portfolio, good financial flexibility and strong liquidity profile. A partially offsetting factor is the company’s material exposure to catastrophe risk, which AM Best expects to be managed through the use of reinsurance and robust exposure management.

Ark’s neutral business profile assessment is reflective of its diversified underwriting portfolio across its Lloyd’s and Bermuda (re)insurance platforms. The group reported gross written premium of $1.9 billion in 2023 and $1.9 billion for the first nine months of 2024. Ark benefits from experienced and stable management and underwriting teams that have been strengthened appropriately as its business has grown.

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