The Global Credit Ratings (GCR) announced the review of Kenya Reinsurance Corporations Limited under the new criteria released in May 2019.
This has seen Kenya Re’s Financial Strength Ratings revised to AA+ as compared to ratings of AA in 2018 with a stable outlook. Furthermore, the Corporation’s international strength ratings have been revised to a rating of B+ in 2019 from a rating of BB in 2018 with a stable outlook. The ratings of the Corporation have been supported by a very strong risk-adjusted capitalization due to adequately catering for the relatively stable quantum of insurance market and credit risk.
The ratings of the Corporation have been supported by a very strong risk-adjusted capitalization due to adequately catering for the relatively stable quantum of insurance market and credit risk.
The higher ratings are attributable to healthy liquidity, supported by the adoption of balanced asset allocation with liquid assets representing 53 % of the total investment portfolio. The rise in ratings has also been credited to liquidity coverage of net technical liabilities and operational cash coverage remaining fairly stable over the last three years.
The strong market share of Kenya Re is as a result of premium diversification, which has allowed for a wider portfolio spread across four lines of business in different countries, with Kenya recently posting gross premiums of 49 % while India generated 20 %.
The business profile of the reinsurer is premised on a strong adjusted capitalization and a stable business profile, liquidity risks and equipoised earnings.
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