AM Best has revised its outlook for Greenlight Reinsurance, Ltd. (Cayman Islands) and Greenlight Reinsurance Ireland, DAC (Ireland) from stable to positive, while affirming the financial strength rating of A- (Excellent) and the long-term issuer credit ratings (long-term ICR) of “a-” (Excellent).
Additionally, AM Best revised the outlook to positive from stable and affirmed the long-term ICR of “bbb-” (Good) for Greenlight Capital Re, Ltd. (Cayman Islands) [NASDAQ: GLRE], the parent company.
According to AM Best, the ratings reflect Greenlight Capital Re’s balance sheet strength, which is assessed as very strong, alongside its marginal operating performance, neutral business profile, and appropriate enterprise risk management (ERM).
The positive outlooks are based on AM Best’s assessment of Greenlight Capital Re’s improving operating performance in recent years. Despite a history of volatile investment returns and underwriting losses, recent underwriting results have been favorable, and the company’s investment performance has stabilized.
Notably, Greenlight Capital Re achieved full-year underwriting profitability for the first time in 2023. The company has also shown five consecutive years of improvement in return on equity and revenue growth. Since 2019, investment returns have been accretive to overall results.
Greenlight Capital Re’s business profile is regarded as neutral by AM Best. The company, incorporated in the Cayman Islands in 2004, is recognized as one of the longest-tenured total return reinsurers. Through its subsidiaries, the company provides property/casualty reinsurance globally.
In efforts to diversify its business, Greenlight Capital Re has made significant investments in its innovation-related operations, including the 2022 launch of Greenlight Re Innovations Syndicate 3456 at Lloyd’s. AM Best also views the company’s ERM as appropriate for the complexity of its operations and overall risk profile.
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