AM Best Affirms Credit Ratings of N.V. Univé Her
23 May 2024 - 1:46AM
Business Wire
AM Best has affirmed the Financial Strength Rating of A
(Excellent) and the Long-Term Issuer Credit Rating of “a”
(Excellent) of N.V. Univé Her (Univé Her) (Netherlands), a wholly
owned subsidiary of Co�peratie Univé U.A. (Univé Group), a mutual
insurance group domiciled in the Netherlands. The outlook of these
Credit Ratings (ratings) is stable.
The ratings reflect Univé Her’s balance sheet strength, which AM
Best assesses as very strong, as well as its adequate operating
performance, neutral business profile and appropriate enterprise
risk management. The ratings also consider Univé Her’s strategic
importance to and integration within the Univé Group (the group) as
its internal reinsurance vehicle, with the company benefiting from
rating enhancement as a result.
Univé Her’s balance sheet strength is underpinned by its
risk-adjusted capitalisation, which remained at the strongest level
at year-end 2023, as measured by Best’s Capital Adequacy Ratio
(BCAR). Given the company’s significant exposure to catastrophe
losses, prospective risk-adjusted capitalisation is prone to
volatility. An offsetting factor is the company’s dependence on
retrocession to manage its natural catastrophe exposure; however,
the risks associated with this dependence are partially offset by
the high credit quality of the counterparties.
Univé Her’s underwriting results are solid, having generated a
five-year (2019-2023) average combined ratio of 75.4% (as
calculated by AM Best), and overall operating earnings are
supplemented by modest investment returns reflective of the
company’s conservative investment portfolio. In 2023, Univé Her
reported an after-tax profit of EUR 3.5 million (2022: EUR 6.4
million loss after tax), underpinned by a combined ratio of 98.1%
(125%), which improved mainly due to a reduced impact of natural
catastrophe events compared with 2022. In addition, the company’s
five-year average (2019-2023) return-on-equity (ROE) ratio is 2.8%
(as calculated by AM Best). Given the nature of the
catastrophe-exposed property reinsurance risks written, Univé Her’s
technical performance is subject to periodic volatility.
Given its distinctive role as the group’s main reinsurer, Univé
Her benefits from its exclusive access to the reinsurance business
ceded by the Univé mutuals and N.V. Univé Schade. Univé Her is
predominantly a monoline reinsurer; the company retains the
property excess of loss reinsurance risk ceded by the regional
mutuals. All other product lines are retroceded to the external
reinsurance market, with the exception of motor hull insurance,
which has been partially included within Univé Her’s risk appetite
beginning in 2020. An offsetting factor to the business profile
assessment is the company’s limited geographic diversification,
with its portfolio concentrated exclusively within the
Netherlands.
This press release relates to Credit Ratings that have been
published on AM Best’s website. For all rating information relating
to the release and pertinent disclosures, including details of the
office responsible for issuing each of the individual ratings
referenced in this release, please see AM Best’s Recent
Rating Activity web page. For additional information
regarding the use and limitations of Credit Rating opinions, please
view Guide to Best’s Credit Ratings. For information
on the proper use of Best’s Credit Ratings, Best’s Performance
Assessments, Best’s Preliminary Credit Assessments and AM Best
press releases, please view Guide to Proper Use of Best’s
Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specialising in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London,
Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more
information, visit www.ambest.com.
Copyright © 2024 by A.M. Best Rating
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James Kenfack Associate Financial Analyst +31
20 808 2272 james.kenfack@ambest.com
Dr. Mathilde Jakobsen Senior Director, Analytics
+31 20 808 3118 mathilde.jakobsen@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com