Kathmandu: Global credit rating agency AM Best has downgraded the financial strength of Russian insurers and reinsurers amid the ongoing war against neighboring country Ukraine.
A new press note issued by AM Best mentions that it has downgraded Russian Re’s Financial Strength Rating to B- (Fair) from B (Fair) and the Long-Term Issuer Credit Rating to ‘bb-‘ (Faed by AMir) from ‘bb+’ (Fair). Similarly, it has also downgraded GIC Perestrakhovanie’s Financial Strength Rating to B+ (Good) from B++ (Good) and its Long-Term Issuer Credit Rating to ‘bbb-‘ (Good) from ‘bbb’ (Good).GIC Perestrakhovanie is a joint venture between Russia and South Asian Country India.
AM Best has also announced that it has downgraded the Financial Strength Rating to B (Fair) from B++ (Good) and the Long-Term Issuer Credit Rating to ‘bb+’ (Fair) from ‘bbb’ (Good) of Ingosstrakh Insurance Company PJSC (Ingosstrakh) (Russia).
In the press note, AM Best has said: “The ratings reflect Russian Re’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management. The rating downgrades reflect deterioration in the company’s balance sheet strength due to heightened geopolitical, economic, and financial system risk in Russia, and takes into consideration the impact of inflation on the adequacy of reserves, liquidity constraints, and the company’s dependence on foreign reinsurers.”