Mexico, Mexico City–(BUSINESS WIRE)–AM Best has assigned a Financial Strength Rating (FSR) of B++ (Good) and a Long-Term Issuer Credit Rating (ICR) of “bbb” (Good) to Nacional de Seguros SA General Insurance Company (National Insurance Company) (Bogotá, Colombia). The outlook assigned to these Credit Ratings (ratings) is stable.
Nacional de Seguros’ ratings reflect its balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate comprehensive risk management.
The ratings also reflect the stronger level of the company’s risk-adjusted capitalization, based on Best’s Capital Adequacy Ratio (BCAR), and the profitability that Nacional de Seguros has achieved during its tenure. relatively short path. Partially offsetting these positive rating factors is the company’s small size, which limits business diversification given the inherent concentration risk, as well as a high reliance on reinsurance.
Nacional de Seguros began operations in 2014, after acquiring Ecoseguros SA, a company in voluntary liquidation, with compliance and civil liability insurance licenses granted by the Financial Superintendence of Colombia. As of December 2021, Nacional de Seguros represented less than 2% market share in the P/C segment in Colombia, and was the second largest company in the compliance insurance sector with a 15% share.
Nacional de Seguros’ risk-adjusted capitalization is at its strongest, according to Best’s Capital Adequacy Ratio (BCAR), and is backed by an extensive reinsurance program and its consistent historical profitability.
The company’s business operations are focused exclusively on Colombia; 86% of the premiums come from Bogotá, 12% from Medellín and 2% from other cities.
Despite reporting fluctuations in gross premiums, the company has maintained a consistent level of retention and profitability. Underwriting metrics are characterized by contained average claims costs and negative acquisition cost ratios due to Nacional de Seguros’ high ceding profile. The company’s financial product has shown a stable trend in recent years, moderately supporting Nacional de Seguros’ income generation.
AM Best does not expect positive rating actions in the medium term. Negative rating actions could occur if the company’s underwriting performance deteriorates, if there is a significant increase in its business risk as a result of the negative consequences of high reliance on reinsurance, or if risk-adjusted capitalization ceases to support current ratings by any other factor.
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contacts
Olga Rubo, FRM
Senior Financial Analyst
+52 55 1102 2720, ext. 134
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Alfonso Novello
Senior Director of Analytics
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Christopher Sharky
Public Relations Manager
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jeff mango
Managing Director,
Strategy and Communication
+1 908 439 2200, ext. 5204
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