AM Best has affirmed the financial strength rating of A- (Excellent) and the long-term issuer credit rating of “a-” (Excellent) for Junto Resseguros SA (Junto Re) and Junto Seguros SA (Junto Seg), collectively known as Junto.
The outlook for both ratings remains positive. Both entities are headquartered in Brazil.
The ratings reflect Junto’s balance sheet strength, which AM Best assesses as the strongest level, along with adequate operating performance, a neutral business profile, and appropriate enterprise risk management (ERM).
The positive outlook is based on AM Best’s expectation that Junto will maintain its profitability, contributing to surplus growth to support an expanding book of business. The outlook also considers ongoing support from The Travelers Companies, Inc, a minority shareholder.
Junto Re operates as a local reinsurer in Brazil, primarily serving as a captive reinsurer for Junto Seg. Junto Seg is the group’s market-facing entity and a leading surety writer in Brazil, with over 20 years in the business.
The companies benefit operationally from Travelers Brazil Acquisition LLC, which holds a 49.5% ownership stake and is ultimately owned by The Travelers Companies, Inc. This relationship provides Junto with operational collaboration on ERM, employee development, retrocession placement, claims handling, and other functions.
Despite returning excess capital to parent companies, Junto maintains modest underwriting leverage, strong liquidity, and a comprehensive retrocession program that provides additional capacity and mitigates exposure, according to AM Best.
While Junto is positioned to benefit from growth opportunities in the surety market, including performance bonds, it faces concentration risks due to its focus on surety underwriting in Brazil.
Regulatory changes, although unlikely, could disrupt the company’s ability to execute its strategy. To address this, Junto has outlined plans for expansion into related lines of business within Brazil, one of Latin America’s largest markets.
Junto’s operating performance has shown consistent improvement over the past five years, supported by strong results in both technical and non-technical accounts. Capital adequacy remains at the strongest levels, and Brazil’s high-interest rate environment has enhanced the company’s financial income, contributing to improved return on equity.
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