A.M. Best has upgraded the Financial Strength Rating of ZEP-RE (PTA Reinsurance Company) to B++ from B+ and its long-term Issuer Credit Rating to “bbb” from “bbb-” with stable outlooks. AM Best is the world’s oldest and leading authoritative insurance rating agency.
ZEP-RE; a COMESA institution and leading regional reinsurer, is headquartered in Nairobi (Kenya) and has offices in Lusaka(Zambia), Harare (Zimbabwe), Khartoum (Sudan), Douala (Cameroon) and Abidjan (Ivory Coast). The company provides reinsurance security within and outside Africa for all kinds of business classes including property, casualty, marine, motor, medical and life.
In its announcement, the rating agency observed that the rating upgrade was a reflection of ZEP-RE’s risk-adjusted capitalization, resilient underwriting profitability and an improved regional competitive position. In addition developments in the company’s enterprise risk management capability and financial flexibility provided by supportive shareholders also contributed to the rating upgrade.
The rating agency however noted a number challenges remained in ZEP-RE’s operating environment including prevailing reinsurance market conditions, increased competition and the Company’s exposure to Kenya’s volatile business environment. A.M. Best’s view on the said risks, however, was that ZEP-RE’s risk management framework should serve as an effective tool to help mitigate these risks.
Going forward, the rating agency expects ZEP-RE to continue growing its franchise while maintaining its strong risk-adjusted capitalization.