AM Best has assigned a Financial Strength Rating of B++ (Good) and a Long-Term Issuer Credit Rating of “bbb+” (Good) to Sapphire Reinsurance Company (Sapphire) (Cayman Islands). The outlook assigned to these Credit Ratings (ratings) is stable.

The ratings reflect Sapphire’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).

Sapphire is the captive reinsurer associated with a large privately owned Colombian conglomerate with operations in different business sectors across Colombia and Latin America, such as industry, motor, textile, pipe manufacturing, public transport, waste management, among others. The portfolio of the company is concentrated in the motor business line, with most of its business being underwritten in Colombia. Due to its limited commercial scope as a captive, its business profile is considered limited.

Sapphire’s balance sheet strength assessment of strongest reflects its stability and constantly growing capital base, characterized by a responsible asset-liability management and a low underwriting leverage. Sapphire has defined policies and procedures that are attached to its risk tolerance and the company is currently implementing a transformation plan, which will digitalize its operations, rendering AM Best’s ERM assessment as appropriate.

Operating performance is considerate adequate given the company’s positive net income results, sustained by stable and ongoing improvements on its technical ratios.

The stable outlooks on Sapphire’s ratings reflects the expectations that the company will continues to obtain positive operating results, maintaining its balance sheet strength assessment.

Positive rating actions could occur if the company keeps up with its good operating performance results in a sustained way. Conversely, negative rating actions could also take place if Sapphire experiences a deterioration in its risk-adjusted capitalization as a result of weak operating performance and/or capital outflows.

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.

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