AM Best Affirms Credit Ratings of Greenlight Capital Re, Ltd. and Its Subsidiaries

Rhea-AI Summary

AM Best has affirmed the Financial Strength Rating of A- (Excellent) and Long-Term Issuer Credit Ratings of 'a-' (Excellent) for Greenlight Reinsurance, Ltd. and Greenlight Reinsurance Ireland, Designated Activity Company, along with a Long-Term ICR of 'bbb-' (Good) for Greenlight Capital Re, Ltd. (GLRE). The outlook remains stable. The ratings reflect GLRE's very strong balance sheet and marginal operating performance, with a combined ratio of 101.9% for 2021. GLRE aims to diversify through innovation-related investments and maintains appropriate enterprise risk management.

Positive

• Affirmed Financial Strength Rating of A- (Excellent) by AM Best.
• Long-Term Issuer Credit Ratings of 'a-' (Excellent) for Greenlight Reinsurance entities.
• Stable outlook for GLRE's ratings.
• Very strong balance sheet strength supported by high risk-adjusted capitalization.
• 2021 combined ratio improved to 101.9%, lowest in the past five years.

Negative

• Marginal operating performance due to historically volatile investment returns.
• Underwriting performance remains marginal.

OLDWICK, N.J.--(BUSINESS WIRE)-- AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” (Excellent) of Greenlight Reinsurance, Ltd. (Cayman Islands) and Greenlight Reinsurance Ireland, Designated Activity Company (Ireland). Additionally, AM Best has affirmed the Long-Term ICR of “bbb-” (Good) of Greenlight Capital Re, Ltd. (Cayman Islands) (GLRE) [NASDAQ: GLRE], the ultimate holding company. The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect GLRE’s balance sheet strength, which AM Best assesses as very strong, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management (ERM).

GLRE’s balance sheet strength assessment of very strong is supported by the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). Consolidated surplus increased in 2021, reversing the previous trend of decline. AM Best expects the company to maintain risk-adjusted capital levels in line with its current ratings.

AM Best views GLRE’s operating performance as marginal, given its historically volatile investment returns and marginal underwriting performance. However, the group’s 2021 combined ratio, inclusive of corporate expenses, improved to 101.9% (company reported 100.9%)—the lowest result over the past five years, based on AM Best’s calculations—and compared favorably with similarly assessed companies in the reinsurance composite. Investment returns since 2019 also have been accretive to results.

AM Best views GLRE’s business profile as neutral. The company was incorporated in the Cayman Islands in 2004 and is one of the longest-tenured total return reinsurers. Through its operating subsidiaries, GLRE provides property/casualty reinsurance on a global scale. The company has taken steps to diversify its platform, including through significant investments in its innovation-related operations, including the 2022 launch of the Greenlight Re Innovations Syndicate 3456 at Lloyd’s. Additionally, GLRE’s ERM is deemed appropriate for the company’s business complexity and overall risk profile.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220909005382/en/

Clare Finnegan

Senior Financial Analyst

+1 908 439 2200, ext. 5165

clare.finnegan@ambest.com

Christopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com

Steven Chirico

Director

+1 908 439 2200, ext. 5087

steven.chirico@ambest.com

Jeff Mango

Managing Director,

Strategy & Communications

+1 908 439 2200, ext. 5204

jeffrey.mango@ambest.com

Source: AM Best

FAQ

What is the Financial Strength Rating of GLRE?

AM Best has affirmed the Financial Strength Rating of A- (Excellent) for GLRE.

What is the Long-Term Issuer Credit Rating for GLRE?

GLRE has a Long-Term Issuer Credit Rating of 'a-' (Excellent) according to AM Best.

What is GLRE's combined ratio for 2021?

GLRE's combined ratio for 2021 improved to 101.9%, the lowest in the past five years.

What does AM Best say about GLRE's balance sheet?

AM Best assesses GLRE's balance sheet strength as very strong, supported by high risk-adjusted capitalization.

What outlook did AM Best give for GLRE's ratings?

AM Best has a stable outlook for GLRE's ratings.