Africa Specialty Risks said Moody’s has revised its outlook on the company’s Baa1 insurance financial strength rating to positive.
Chief executive officer Mikir Shah (pictured above) noted the change follows Fitch’s move last year to assign a positive outlook to ASR’s BBB+ rating.
“ASR continues to expand our business lines, geographies and operational capabilities, which has led to consistently strong underwriting profitability and signals the upward momentum of our ratings. I look forward to the ongoing growth of our business as we continue to focus on enabling sustainable economic development by fulfilling unmet insurance needs,” Shah said.
Moody’s cited several factors supporting the revised outlook. These include a stronger market position and increased relevance in the corporate and specialty insurance market across Africa, as well as improved business and geographic diversification, with growth beyond the continent.
The agency also pointed to sustained underwriting profitability, underpinned by disciplined underwriting and prudent reserving.
According to Moody’s, an upgrade to an A3 rating would require sustained growth in business volume in line with plans, continued strong underwriting performance with loss ratios at or below 60%, progress in reducing inter-company loans to affiliates, and a higher level of on-balance-sheet capital to increase flexibility and resilience. ASR said it expects to meet these conditions in the coming months.
In September last year, Fitch assigned ASR a BBB+ insurer financial strength rating with a positive outlook, pointing to strong capitalization, low leverage, and growth in business volumes.
Another factor in Moody’s latest revision is ASR’s development of new platforms and distribution capabilities, including the April 2024 launch of Syndicate 2454 at Lloyd’s. Managed by Apollo, the syndicate was established with a targeted £70 million in gross premium for its first underwriting year, writing political risk, trade credit, parametric, and other specialty lines aimed at African and international markets.
ASR has also expanded its regional reach, having secured in-principle approval from the Dubai Financial Services Authority in early 2024 to operate as a service company within the Dubai International Financial Centre, providing greater access to clients and brokers in the Middle East.
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