A.M. Best Affirms Credit Ratings of J.Malucelli Resseguradora S.A. and J.Malucelli Seguradora S.A.. The outlook of these Credit Ratings (ratings) remains stable.
Partially offsetting these positive rating factors is JM’s concentration risk as essentially a mono-line surety writer in a single country. JM’s future plans to mitigate this risk include expansion into related lines of business and geographic diversification into other parts of Latin America. Additionally, Brazil’s (re)insurance market is becoming increasingly competitive, with home-grown and global (re)insurers vying for market share. Despite Brazil’s economy beginning to show signs that the economic recession might have ended, companies are still seeking international expansion while keeping an eye on the under-penetrated domestic insurance market. Surety is one of the fastest-growing segments in the (re)insurance industry in Brazil.
Rating factors that could lead to a positive rating movement include successful long-term execution of JM's growth and diversification strategy and consistent operating performance along with maintaining robust risk-adjusted capitalization. Negative rating triggers include deterioration in operating results or risk-adjusted capitalization, the inability for JM to execute its growth and diversification strategy, a continued weakness in Brazil’s economy or a downgrade in Brazil’s country risk tier.
This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.