Market Overview

A.M. Best Removes From Under Review and Upgrades Issuer Credit Ratings of Swiss Reinsurance Company Ltd and Affiliates


A.M. Best has removed from under review with positive
implications and upgraded the Long-Term Issuer Credit Ratings (Long-Term
ICR) to "aa" from "aa-" of Swiss Reinsurance Company Ltd
(Switzerland) and affiliates. Additionally, A.M. Best has affirmed the
Financial Strength Rating (FSR) of A+ (Superior). At the same time, A.M.
Best has affirmed the Short-Term Issue Credit Rating (Short-Term IR) and
upgraded the related Long-Term Issue Credit Ratings (Long-Term IR) of
Swiss Reinsurance Company Ltd and its subsidiaries. The outlook assigned
to these Credit Ratings (ratings) is stable. (See below for a detailed
listing of the companies and ratings.)

The ratings were placed under review with positive implications on 13
October 2017, following the release of the updated Best's Credit Rating
Methodology (BCRM). The ratings have been removed from under review, as
A.M. Best has completed its analysis of the Swiss Re companies under the
updated BCRM.

The rating upgrades reflect A.M. Best's opinion that the rating
fundamentals of the consolidated Swiss Re group (Swiss Re), as analysed
under the updated BCRM, are supportive of the revised Long-Term ICR. The
ratings reflect Swiss Re's balance sheet strength, which A.M. Best
categorises as strongest, as well as its strong operating performance,
very favourable business profile and very strong enterprise risk

Swiss Re's balance sheet strength is underpinned by consolidated
risk-adjusted capitalisation that is comfortably in excess of what is
required for the strongest assessment, as well as excellent financial

A.M. Best's assessment of balance sheet strength takes into account
Swiss Re's announced continuation of its share buy-back programme in the
fourth quarter of 2017 and first quarter of 2018, and an expected
reduction in earnings in 2017 due to catastrophe losses in the third
quarter. For the nine months to 30 September 2017, the group reported an
annualised return on equity of -1.9%, reflecting expected losses of USD
3.6 billion from Hurricanes Harvey, Irma and Maria and from the Mexico
earthquakes. The result is in line with A.M. Best's expectation given
the level of catastrophe activity. The group's operating performance
over the period 2012-2016 was very strong, and benefited from reserve
releases and benign catastrophe experience.

The ratings also reflect Swiss Re's very favourable business profile as
a leading global reinsurer, which is underpinned by a wide product
offering and a worldwide distribution system. The group's reinsurance
segment is well-diversified by line of business and geography. Moreover,
the group's product offering is enhanced by the primary non-life
insurance business underwritten by its Corporate Solutions division, as
well as by the primary life and health closed and open book capabilities
of its Life Capital division. The group's market leading position and
strong relationships with reinsureds allow it to write private deals and
contracts on differentiated terms, which offer protection against
competition from traditional and alternative capital providers.

The Long-Term ICRs have been upgraded to "aa" from "aa-" and the FSR of
A+ (Superior) has been affirmed for Swiss Reinsurance Company Ltd
and its following affiliates:

  • Swiss Re Asia Ltd
  • Swiss Re Europe S.A.
  • Swiss Re International SE
  • Swiss Re Corporate Solutions Ltd
  • Swiss Re Life & Health America Inc.
  • Swiss Reinsurance America Corporation
  • Westport Insurance Corporation
  • North American Specialty Insurance Company
  • North American Capacity Insurance Company
  • North American Elite Insurance Company
  • Washington International Insurance Company
  • First Specialty Insurance Corporation

In addition, an FSR of A+ (Superior) and a Long-Term ICR of "aa", each
with a stable outlook, have been assigned to Swiss Re Portfolio
Partners S.A

The Long-Term ICR has been upgraded to "a" from "a-" for Swiss Re
America Holding Corporation

The following Short-Term IR has been affirmed:

Swiss Reinsurance Company Ltd—
-- AMB-1+ on Euro medium-term
notes (EMTN) programme

The following Long-Term IRs have been upgraded:

Swiss Reinsurance Company Ltd—
-- to "aa-" from "a+" on EUR
500 million 6.625% subordinated notes, due 2042
-- to "a+" from "a"
on USD 750 million 8.25% perpetual junior subordinated capital

-- to "a+" from "a" on GBP 500 million 6.302%
perpetual junior subordinated step-up notes

Swiss Re Treasury (US) Corporation—
-- to "aa" from "aa-" on
USD 250 million 2.875% senior unsecured notes, due 2022
-- to "aa"
from "aa-" on USD 500 million 4.25% senior unsecured notes, due 2042

Swiss Re America Holding Corporation—
-- to "a" from "a-" on
USD 400 million 6.45% senior unsecured notes, due 2019 (of which USD 234
million remains outstanding)
-- to "a" from "a-" on USD 600 million
7.00% senior unsecured notes, due 2026 (of which USD 397 million remains
-- to "a" from "a-" on USD 350 million 7.75% senior
unsecured notes, due 2030 (of which USD 193 million remains outstanding)

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
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases

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Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its
subsidiaries. ALL RIGHTS RESERVED.

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