A.M. Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of "a-" to R&Q Insurance (Malta) Ltd. (RQIM) (Malta). The outlook assigned to these Credit Ratings (ratings) is stable. At the same time, A.M. Best has affirmed the Long-Term ICR of "bbb-" of Randall & Quilter Investment Holdings Ltd. (RQIH) (Bermuda). The outlook of this rating is stable. RQIM is a subsidiary of RQIH.
The published rating of RQIH, as a non-operating insurance holding company (IHC), is determined by reference to the credit assessment of RQIH on a consolidated basis, and the normal subordination of IHC creditors to operating company policyholders. A.M. Best's credit assessment of RQIH on a consolidated basis reflects its balance sheet strength, which A.M. Best categorises as strong, as well as its adequate operating performance, neutral business profile, and appropriate enterprise risk management (ERM).
RQIH owns, through its subsidiaries, non-life insurance portfolios in runoff and insurance entities that are open to new insurance business, including residual run-off exposures to Lloyd's Syndicate 1991. Starting in 2016, RQIH also began writing programme business through two of its main operating subsidiaries, Accredited Surety and Casualty Company, Inc. and RQIM. RQIH's strong profile in the small and medium-sized run-off market helps it to generate a flow of new profitable run-off acquisitions. It is important that a flow of new business is continually generated, as the profit arising from these acquisitions is essential for funding the group's expenses and supporting its financial performance. Recently, RQIH has streamlined its business by disposing of non-core operations and focusing on legacy business, for which it has good expertise, and growing its programme business in the United States and Europe, by means of agreements with managing general agents and collaboration with large reinsures. A.M. Best expects the group's profitability to improve as a result of these activities as it achieves cost efficiencies. Offsetting rating factors include the expected increasing dependence on reinsurance that likely will occur with the expansion and the execution risk underlying the shift in business strategy as well as recent organisational changes.
