The industry’s largest reinsurer Munich Re has capitalised a run-off Bermuda unit and which it will use as an in-house reinsurer of group subsidiaries.
Munich Re Bermuda is a vehicle for the group’s US life reinsurance business after the unit recently received a new moniker from its previous title, Princeton Eagle West Insurance Company Ltd.
Munich Re Bermuda is now authorised as a Class C insurer by the Bermuda Monetary Authority and recently received a $330mn capital injection by its parent.
It also benefits from a parental excess of retention and an excess of loss reinsurance treaty. AM Best has assigned the unit an A+ financial strength rating with a stable outlook.
According to the rating agency, the ratings reflect “Munich Re Bermuda’s strategic importance and integration into its ultimate parent company, Munich Re, as a vehicle for placing the group’s related life U.S. reinsurance business”.
AM Best continued: “Therefore, Munich Re Bermuda’s ratings are aligned with that of Munich Re, and reflective of the group’s balance sheet strength, which AM Best categorizes as strongest, as well as its strong operating performance, very favourable business profile and very strong enterprise risk management.”