Ratings Affirmation
AM Best has reaffirmed the Financial Strength Rating of A- (Excellent) for Harrington Re Ltd. (Harrington), along with a Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent).
Similarly, Harrington Reinsurance Holdings Limited has also received an affirmed Long-Term ICR of “bbb-” (Good).
Both companies are headquartered in Bermuda, and their ratings outlook remains stable.
Financial Strength and Performance
These ratings signal the strength of Harrington’s balance sheet, which AM Best considers to be very strong.
The company showcases adequate operational performance, a balanced business profile, and solid enterprise risk management strategies.
Since its inception in 2016, Harrington has been supported by industry giants AXIS Capital Holdings Limited (AXIS) and The Blackstone Group Inc. Based on AM Best’s Capital Adequacy Ratio (BCAR), Harrington’s risk-adjusted capitalization is classified at the strongest level.
A recent redemption of senior notes in early 2024 has positively impacted the company’s financial leverage.
Looking ahead, AM Best expects that Harrington’s BCAR metrics will continue to reflect its overall very strong balance sheet strength.
Future Outlook and Risks
Although Harrington is in a strong position, potential rating downgrades could occur if the company faces substantial adverse developments related to reserves that might compromise its capitalization.
Similarly, a notable dip in investment performance or a decrease in risk-adjusted capitalization could trigger a downgrade.
While the likelihood of this happening in the short term seems low, positive rating adjustments could be on the horizon if there’s a consistent trend of favorable reserve development.
For more insights related to these credit ratings, readers can visit AM Best’s official website, where detailed information and relevant disclosures are available.
Source: Ambest
