The Impact of AM Best Ratings on the Financial Stability of International General Insurance Holdings Ltd

During its annual rating review, AM Best has affirmed the credit rating for International General Insurance Holdings Ltd. Its strong financial position and positive outlook are reason for the rating. It could change in the event that the business faces financial challenges. Here are the major factors that may influence the rating.

Financial strength ratings

AM Best anticipates strong underwriting performances of International General Insurance Holdings Ltd. for the first nine months. The consolidated balance sheet strength of the company is considered extremely strong. It is anticipated that the company will earn substantial profits in 2022. The company is also anticipated to increase its financial flexibility by 2020. It is believed that the firm will be listed on the Nasdaq stock exchange.

Good liquid profile. A highly rated panel of Reinsurance. AM Best assessed the enterprise risk management of the company as necessary. The performance of the underwriting department has been stable and the profitability has improved. The company expects its underwriting success to continue and the profitability will remain at its current levels.

AM Best affirmed the long-term issuer credit rating of IGI. The company also acknowledged the strength of the financial rating of IGI in addition. The rating reflects IGI’s solid balance sheet as well an appropriate risk management for the enterprise and an adequate operational performance.

Long-term issuer credit ratings

AM Best has affirmed the The Associated Long-Term Issuer Ratings Credit Ratings of IGI. These ratings can be used for IGI as well as its subsidiaries and its affiliates, including Chubb Bermuda Insurance Ltd. and Chubb Limited as well as MedPro Ltd. and National Indemnity Company.

Each company’s rating reflects their financial strength, the company profile, and their ability to satisfy the requirements of their policyholders. AM Best rated the companies in their Enterprise Risk Management (ERM) as adequate. The ratings also recognize their strong balance sheets and operating margins. The ratings also reflect their support for the international A&H sector.

Though IGI’s capital structure is smaller, it offers excellent diversification and a reinsurance panel. Its liquidity profile has been a strong. The company reported an average 5-year ratio that was 92% during 2017 through 2021. The company is expected to report strong results in the initial nine months in the current year, and also in 2022. The company’s underwriting results have changed over the past five years. It’s taken the corrective step to reverse the company’s decline in underwriting.

The credit profile of GE is impacted by deterioration in credit

GE is a global business that is able to generate significant margins in its key areas. But, the margins of GE are lower than peers due to the tough situations for the Power and Renewable Energy businesses. The company is however in a strong market position which helps to alleviate short-term problems in these industries.

The long-term IDR rating of BBB+ is for issues default rating (IDR). However, despite having a more leverage than the other similar-rated finance companies, including stand-alone leasing but it also has good funding options and an established air leasing franchise. Through intercompany loans, it has access to GE Industrial resources.

GE Capital has $12 billion in loans to intercompanies and 15 billion in senior secured notes. The leverage of GE Capital is believed to be approximately four times greater than similarly rated finance companies. The leverage is expected to remain at its current level over the medium-term. It is also subject to the risk of residual value when it comes to leasing aircraft, along with cyclicality risk.

Outlook

Founded in 2001, International General Insurance Holdings Ltd (IGI) is a specialist commercial reinsurer and specialty insurer with a global range of commercial. It operates in three primary sections, including reinsurance as well as specialty insurance. General third-party liability insurance and accidental insurance are the main business segments. Its portfolio is diverse both in terms of its products and markets. Furthermore, its management team has a long-standing tradition of hiring top employees. The company’s liquidity is adequate and the balance sheet solid.

IGI is a portfolio manager of insurance specialty businesses across various industries like maritime, aviation, engineering and aviation. Prompt approval was granted by the company to write excess lines in America. The firm will begin the process of writing excess lines on starting on April 1st, 2020. Additionally, it inaugurated a representative office located in Casablanca Finance City, Morocco. The firm has started to provide energy insurance. One of its worldwide operations is a Dubai branch.

AM Best assigned IGI an A Financial Strength Rating. This rating indicates its stability forecast, strong capitalisation and a prudent reserving policy. IGI is predicted to produce excellent underwriting results in the coming months. Its diverse business model and strong underwriting discipline is also praised in the report by AM Best.