AM Best Affirms Credit Ratings of Solidarity Bahrain B.S.C.

The outlook of the FSR is stable, while the outlook of the Long-Term ICR is positive


LONDON: AM Best has affirmed the Financial Strength Rating (FSR) of “B++” (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb” of Solidarity Bahrain B.S.C.  (Solidarity Bahrain) (Bahrain). The outlook of the FSR is stable, while the outlook of the Long-Term ICR is positive.

 The Credit Ratings (ratings) reflect Solidarity Bahrain’s balance sheet strength, which AM Best categorises as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. The ratings also factor in rating enhancement, reflecting Solidarity Bahrain’s strategic importance to its ultimate parent company, Solidarity Group Holding BSC (c) (SGH), a leading provider of Islamic insurance solutions in Bahrain and Jordan.

The positive Long-Term ICR outlook reflects the potential benefits of an enhanced business profile of the Solidarity group following the integration of Al Ahlia Insurance Company B.S.C. (AAIC) (Bahrain) into its operations.

Solidarity Bahrain’s balance sheet strength is underpinned by its risk-adjusted capitalisation being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), good liquidity and financial flexibility, with access to the debt and the equity markets. The assessment also factors in the company’s high reinsurance dependence and the elevated asset risk stemming from its investment portfolio, which is concentrated in Bahrain and the Gulf Corporation Council.

AM Best expects Solidarity Bahrain’s operating performance to remain adequate, benefitting from corrective actions taken by management to improve the profitability of AAIC’s legacy operations through strengthened underwriting practices and more stringent risk selection. Furthermore, de-risking of Solidarity Bahrain's investment portfolio is expected to result in greater earnings stability over the medium term.

Solidarity Bahrain was formed following the merger between AAIC and Solidarity General Takaful BSC (c) on 3 December 2017, creating a leading insurer in the Bahraini insurance market by gross written contribution.  However, Solidarity Bahrain's business profile remains limited by its concentration in Bahrain’s insurance market, which is relatively small and highly competitive.

© Press Release 2018

Disclaimer: The contents of this press release was provided from an external third party provider. This website is not responsible for, and does not control, such external content. This content is provided on an “as is” and “as available” basis and has not been edited in any way. Neither this website nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this press release.

The press release is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Neither this website nor our affiliates shall be liable for any errors or inaccuracies in the content, or for any actions taken by you in reliance thereon. You expressly agree that your use of the information within this article is at your sole risk.

To the fullest extent permitted by applicable law, this website, its parent company, its subsidiaries, its affiliates and the respective shareholders, directors, officers, employees, agents, advertisers, content providers and licensors will not be liable (jointly or severally) to you for any direct, indirect, consequential, special, incidental, punitive or exemplary damages, including without limitation, lost profits, lost savings and lost revenues, whether in negligence, tort, contract or any other theory of liability, even if the parties have been advised of the possibility or could have foreseen any such damages.

More From Press Releases