AM Best has affirmed the Financial Strength Rating of A++ (Superior) and the Long-Term Issuer Credit Rating of “aa+” (Superior) of Chubb Seguros Panama S.A. (Chubb Panama) (Panama City, Panama). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Chubb Panama’s strategic importance as a subsidiary of Chubb Limited, which on a consolidated basis has a balance sheet strength that AM Best assesses at the strongest level, as well as its very strong operating performance, favorable business profile and appropriate enterprise risk management (ERM).

The rating affirmations reflect Chubb Panama’s integration and support from Chubb Limited, one of the world’s largest insurance groups, which provides synergies and operating efficiencies to the Panama subsidiary.

The stable outlooks reflect AM Best’s expectation that Chubb Limited will maintain its strongest balance sheet strength assessment, supported by risk-adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), while continuing to demonstrate very strong operating results driven by the group’s consistently solid underwriting performance.

The ratings reflect Chubb Panama’s sound underwriting practices, which support its consistent operating performance, diversified business portfolio and solid reinsurance program, with Chubb Tempest Reinsurance Ltd. This affiliation provides Chubb Panama with synergies and operating efficiencies. Offsetting these positive rating factors are Chubb Panama’s modest, but growing market share within Panama’s insurance industry relative to the lines of business it underwrites, and the strong competitive environment in Panama’s insurance sector. However, the company partially mitigates this competitive aspect through its diversified business portfolio that is spread across other markets in Central America.

Chubb Panama initiated operations in 2008 as ACE Seguros S.A., and continued with that brand name until 2016, when its name was changed to Chubb Seguros Panama S.A. Chubb Panama underwrites mainly non-life and reinsurance businesses that covers exposures throughout Panama and Central America. In 2023, property stood as the company’s main business line, generating 32% of its gross written premium. Chubb Panama’s main distribution channels are positioned with brokers and cedent companies.

Chubb Panama has shown disciplined underwriting in a highly competitive market, consistently reporting overall premium sufficiency levels that compare positively with its competitors. In 2023, Chubb Panama achieved a combined ratio of 73%, down from 81% in 2022, benefiting from a lower loss ratio.

Chubb Panama’s strong underwriting results have sustained its sound overall profitability, as reflected in a return on equity of 27% in 2023. AM Best expects Chubb Panama’s risk-based capitalization to remain supported by the group´s conservative capital management guidelines.

Moreover, the company benefits from being integrated into the group, gaining operational leverage through the same systems, procedures and ERM practices. The group historically has demonstrated its support to Chubb Panama through capital injections to fund growth opportunities. A change in AM Best’s perception regarding the strategic importance of Chubb Panama to the group could impact Chubb Panama’s ratings.

Additionally, the company’s ratings could be affected negatively by the following factors: deterioration in the group’s risk-adjusted capitalization to a level that no longer supports Chubb Limited’s current ratings; sustained deterioration in operating performance; or a material weakening of Chubb Limited’s overall credit 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.

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