A.M. Best Affirms Credit Ratings of Covéa Coopérations
Alex Rafferty, ACA, +44 20 7397 0285
Senior Financial Analyst
Christopher Sharkey, +1 908 439 2200, ext. 5159
Manager, Public Relations
Ghislain Le Cam, CFA, FRM, +44 20 7397 0268
Jim Peavy, +1 908 439 2200, ext. 5644
Director, Public Relations
A.M. Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” of Covéa Coopérations (France). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Covéa Coopérations’ balance sheet strength, which A.M. Best categorises as strongest, as well as its adequate operating performance, favourable business profile and appropriate enterprise risk management.
The ratings factor in Covéa Coopérations’ strategic importance to Société de Groupe d’Assurance Mutuelle Covéa (Covéa), a leading mutual insurance group in France, as it is the intermediate holding company of the group’s operating entities and its principal outwards reinsurance vehicle. In recent years, the Covéa group structure has been streamlined so that the majority of its operating insurance companies are now held by Covéa Coopérations. This has increased the integration of the group’s operations and enhanced the strategic alignment of its members.
As Covéa Coopérations’ subsidiaries underwrite approximately 90% of Covéa’s consolidated premiums and account for around 80% of Covéa’s consolidated capital, Covéa Coopérations’ balance sheet strength assessment mirrors that of Covéa.
Likewise, Covéa Coopérations’ favourable business profile assessment is primarily underpinned by its role as the holding company of most of the Covéa group’s operating subsidiaries. As an operating entity, Covéa Coopérations is a modest sized reinsurer, writing a start-up portfolio of life and health reinsurance in France, as well as the group’s established international reinsurance portfolio (previously underwritten by Assurances Mutuelles de France, a mutual member of Covéa). In 2017, the company wrote EUR 242.1 million of gross written premium, of which EUR 28.0 million was life and health reinsurance, and the balance derived from its international operations.
Covéa Coopérations’ adequate operating performance assessment is reflective of the performance of the Covéa group, which is driven by the core operating subsidiaries of Covéa Coopérations. In 2017, the group reported a non-life combined ratio of 97.5% and net income of EUR 817.8 million. On a stand-alone basis, Covéa Coopérations’ has been profitable over recent years, although results have been driven primarily by dividends from subsidiaries. Reinsurance operations were close to break-even in 2017, with the company returning a non-life combined ratio of 100% in 2017 (as calculated by A.M. Best), and a marginal underwriting loss for the life business. A.M. Best expects the company to generate technical profits (on a stand-alone basis) over the medium term, although investment income will remain the core driver of overall operating earnings.
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. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper [..].
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