AM Best upgrades outlook on WAICA Re to positive, ratings affirmed

AM Best has revised the outlook for WAICA Reinsurance Corporation PLC (WAICA Re) to positive from stable, while affirming the company’s Financial Strength Rating (FSR) of B (Fair) and the Long-Term Issuer Credit Rating of “bb+” (Fair).

According to AM Best, the revised outlook reflects growing confidence in WAICA Re’s ability to strengthen its market position and sustain solid operating results over time.

The affirmed ratings are based on AM Best’s assessment of WAICA Re’s balance sheet strength—classified as strong—alongside its consistent performance, narrowly focused business operations, and basic enterprise risk management practices.

In its report, AM Best highlighted WAICA Re’s robust capital position, which continues to support its overall financial strength. The company’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), remained comfortably within the strongest level at the end of 2024.

AM Best noted that the capital buffer—already strong in 2023—expanded further in 2024 due to healthy organic growth and improvements in asset quality. The agency also acknowledged the company’s ongoing efforts to manage investment risk by shifting more of its assets into regions with lower country risk exposure.

Despite this progress, AM Best pointed out that WAICA Re remains vulnerable to systemic risks tied to sub-Saharan Africa, where a significant portion of its assets is still concentrated.

AM Best assessed WAICA Re’s operating performance as strong, driven by solid underwriting discipline and steady returns. In recent years, the company has consistently generated return-on-equity (ROE) figures that exceed benchmark interest rates in its operating regions.

WAICA Re’s technical expertise—particularly in both treaty and facultative reinsurance—has been instrumental in delivering these results. AM Best expects this trend to continue, projecting that the company’s earnings will remain healthy, supported by continued underwriting discipline and moderate investment income, consistent with its low-yield investment approach.

The outlook revision to positive suggests that, if WAICA Re continues to enhance its market profile and maintain strong operating fundamentals, AM Best may consider future upward movement in its ratings.