October 23, 2021
  • October 23, 2021
  • Home
  • Asset Risk
  • AM Best confirms the credit ratings of Allianz SE and its rated subsidiaries

AM Best confirms the credit ratings of Allianz SE and its rated subsidiaries

By on October 8, 2021 0

AMSTERDAM – (COMMERCIAL THREAD) –AM Best confirmed the financial strength rating (FSR) of A + (superior) and the long-term issuer credit rating (long-term ICR) of “aa” (superior) of Allianz SE (Allianz) (Germany) and of its rated subsidiaries (see below for the list of companies). The outlook for these credit ratings (ratings) is stable.

The ratings reflect the strength of Allianz’s balance sheet, which AM Best considers to be the strongest, as well as its strong operational performance, very favorable business profile and very strong Enterprise Risk Management (ERM).

AM Best expects Allianz’s risk-adjusted consolidated capitalization, as measured by Best’s capital adequacy ratio (BCAR), to be maintained at the highest level, supported by strong earnings generation and a prudent approach to capital management. The leverage and coverage ratios support the assessment of balance sheet strength and financial flexibility is considered excellent due to the group’s good access to capital markets.

Allianz has a history of strong and stable operating performance, supported by its diversified earnings profile. The group produced a five-year weighted average return on equity ratio of 10.5% (2016-2020) (as calculated by AM Best). Its P&C segment has demonstrated continued strong performance, posting a five-year average combined ratio of 95.1%, supported by strong group-wide pricing capabilities. The group posted a combined ratio of 93.4% in the half of 2021 (end of 2020: 96.3%). The improvement is largely due to the absence of negative effects from the Covid-19 pandemic and a higher reserve flow ratio. The operating income of the life / health segment shows a compound annual growth rate over five years of 1.9%, reaching 4.4 billion euros in 2020 despite a lower investment margin due to the environment of low interest rate. The profitable and scalable asset management activity of the group continues to constitute a good source of additional income (25% of the group’s operating profit in 2020).

Allianz is one of the largest insurance groups in the world, with superior diversification by geographic area and industry, and leading positions in many developed and emerging markets, offering a full range of products from life and non-life insurance, as well as asset management services. Its competitive position is supported by its size, solid management capabilities, dynamic strategy and strong brand.

The very strong ERM assessment is underpinned by Allianz’s strong risk culture and the sophisticated ERM framework that is embedded throughout the organization. AM Best will continue to monitor developments regarding the ongoing litigation in US courts against Allianz Global Investors regarding Structured Alpha funds, as well as related investigations by regulators and the US Department of Justice.

The FSR of A + (Superior) and the Long Term ICR of “aa” (Superior) were confirmed with stable prospects for the following subsidiaries of Allianz SE:

  • Allianz Global Corporate & Specialty Resseguros Brasil SA

  • Allianz Global Corporate & Specialty SE

  • Allianz SpA

  • Allianz Risk Transfer SA

  • Allianz Risk Transfer (Bermuda) Limited

  • AWP P&C SA

  • Jefferson Insurance Company

  • AWP Santé & Vie SA

  • Allianz Global Risks American Insurance Company

  • Allianz Underwriters Insurance Company

  • AGCS Marine Insurance Company

  • American auto insurance company

  • Euler Hermes Insurance Company North America

  • National surety company

  • The American Insurance Company

  • Associated compensation company

  • Chicago Insurance Company

  • Firefighters Fund Insurance Company

  • Firefighters Fund Compensation Corporation

  • Interstate Fire & Casualty Company

  • Allianz Life Insurance Company of North America

  • Allianz Life Insurance Company of New York

  • Allianz México, SA, Company of Seguros

The following long-term IRs have been confirmed with a stable outlook:

Allianz Finance II BV (debt issues are guaranteed by Allianz SE) –

– “aa” (Superior) on 750 million euros of senior unsecured bonds at 3%, maturity 2028

– “aa” (Superior) on GBP 750 million senior unsecured 4.5% bonds, maturing in 2043

– “aa” (Superior) on 1.5 billion euros of senior unsecured bonds at 3.5%, maturity 2022

Allianz SE—

– “a +” (Excellent) on 1.5 billion euros of perpetual subordinated bonds at 4.75%

– “aa-” (Superior) on 1.5 billion euros of 5.625% subordinated bonds, maturity 2042

– “a +” (Excellent) on EUR 1.5 billion 3.375 perpetual junior subordinated bonds

This press release relates to credit ratings published on the AM Best website. For all rating information relating to the publication and relevant disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this publication, please see AM Best’s Recent Rating Activity webpage. . For more information on the use and limitations of credit rating reviews, please see Best’s Guide to Credit Ratings. For more information on the proper use of Best Credit Ratings, Best Preliminary Credit Ratings, and AM Best press releases, please see the Guide to Appropriate Use of Best Ratings and Ratings.

AM Best is a global credit rating agency, news publisher, and data analytics provider specializing in the insurance industry. Based in the United States, the company operates in more than 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2021 by AM Best Rating Services, Inc. and / or its affiliates. ALL RIGHTS RESERVED.