The FSR of “A- (Excellent)” and the long-term ICR of “a-” of Casiopea Re (CRe) have been withdrawn by A.M. Best because the company has stopped conducting insurance operations.
NCRe is a captive reinsurer of Telefonica, a Spanish multinational broadband and telecommunications provider operating in Europe, Asia, and North, Central and South America.
Earlier this year, NCRe replaced CRe as Telefonica’s main reinsurance captive and assumed the run-off liabilities of CRe.
NCRe’s ratings are reflective of its balance sheet strength, which A.M. Best categorises as very strong, in addition to its adequate operating performances, neutral business profile and appropriate enterprise risk management.
A.M Best suggested that NCRe’s balance sheet strength “is driven by the strongest level of risk-adjusted capitalisation, supported by an excellent level of liquidity managed through conservative investment guidelines”.
The ratings agency expects NCRe to generate €56 million of gross written premiums during 2017, its first year of operation.
NCRe is managed by the same personnel that managed CRe for more than 10 years, which according to A.M. Best, means there is a substantially reduced execution risk associated with the new captive due to the managements’ proven track record.
Offsetting the rating partially is the level of catastrophe risk that the company is exposed to, which is likely to cause volatility.