Market Overview

A.M. Best Assigns Credit Ratings to The Toa 21st Century Reinsurance Company, Ltd.; Affirms Credit Ratings of The Toa Reinsurance Company, Limited and The Toa Reinsurance Company of America

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A.M. Best has assigned a Financial Strength Rating (FSR) of A
(Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of "a+"
to The Toa 21st Century Reinsurance Company, Ltd. (TTFC)
(Switzerland). The outlook assigned to these Credit Ratings (ratings) is
stable. Concurrently, A.M. Best has affirmed the FSR of A (Excellent)
and the Long-Term ICRs of "a+" of The Toa Reinsurance Company, Limited
(Toa Re) (Japan) and The Toa Reinsurance Company of
America (TRA) (headquartered in Morristown, NJ). The outlook of these
ratings is stable. TTFC is a newly added member of Toa Re, of which TRA
is the other member.

The ratings of Toa Re reflect the company's consolidated balance sheet
strength, which A.M. Best categorizes as strongest, as well as its
adequate operating performance, neutral business profile and appropriate
enterprise risk management.

Toa Re's balance sheet strength is assessed at the strongest level,
owing to its conservative risk management in its underwriting and
investment strategies. The company's risk-adjusted capitalization has
improved significantly in the past five years from stable and positive
operating results. Despite a series of catastrophe events in North
America, the company maintained profitable underwriting results in
fiscal year 2017. Offsetting rating factors include limited growth
opportunities in Japan's domestic reinsurance market and intense
competition in the global reinsurance market, owing to abundant capacity.

Negative rating actions could occur if there is a substantial decline in
risk-adjusted capitalization resulting from significant underwriting
losses, or adverse movements in the financial markets.

TTFC has been a wholly owned reinsurance subsidiary of Toa Re since 2002
that mainly assumed captive business from its parent. In May 2018, Toa
Re announced that TTFC will underwrite third-party business under the
brand name of Toa Re Europe. The company will strengthen its experienced
underwriting team by adding other reinsurance professionals locally to
TTFC and will serve as the group's major European underwriting platform.
In addition, the Toa Re will gradually transfer part of its existing
European book of business to TTFC.

The addition of TTFC to the Toa Re's rating unit reflects its strategic
importance to Toa Re's growth and geographic diversification strategy.
Toa Re provides various explicit and implicit support, such as business
transfer, risk management and operational support to TTFC. A.M. Best
views Toa Re as strongly committed to TTFC's development and long-term
success and will provide necessary financial support if needed.

Ratings are communicated to rated entities prior to publication.
Unless stated otherwise, the ratings were not amended subsequent to that
communication.

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 Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases
.

A.M. Best is a global rating agency and information provider with a
unique focus on the insurance industry. Visit
www.ambest.com
for more information.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its
affiliates. ALL RIGHTS RESERVED.

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