|[March 24, 2014]
A.M. Best Affirms Ratings of Blue Whale Re Ltd.
OLDWICK, N.J. --(Business Wire)--
A.M. Best has affirmed the financial strength rating of A
(Excellent) and issuer credit rating of "a+" of Blue Whale Re Ltd.
(Blue Whale) (Burlington, VT). The outlook for both ratings is stable.
The ratings reflect Blue Whale's strong capitalization and conservative
operating strategy. The ratings also consider the company's critical and
central role and favorable profile as part of the Pfizer Group, as well
as the excellent performance of its operations. Partially offsetting
these positive rating factors are Blue Whale's very large gross and net
underwriting exposures to property losses and its dependence on
Blue Whale is a single parent captive of Pfizer Inc. (Pfizer)
[NYSE: PFE], a leading global pharmaceutical company. As Blue Whale
(re)insures Pfizer's global property exposures, it plays an important
role in Pfizer's overall enterprise risk management and assumes a
critical role in protecting the Pfizer Group's assets. Thus, Blue Whale
benefits from Pfizer Group's extensive risk management and loss control
Blue Whale operates at conservative underwriting leverage levels;
however, it provides coverages with extremely large limits, and its
gross exposures per loss occurrence are elevated. Although Blue Whale
benefits from reinsurance protection, its net retentions remain very
substantial. Reinsurance is providedby a large panel of reinsurers, and
Blue Whale relies on significant capacity to be able to support its
obligations. As such, it is heavily dependent on reinsurance.
Nevertheless, A.M. Best recognizes the quality of the reinsurers and the
substantial financial resources and support available to the captive as
part of the Pfizer Group.
Positive rating actions could occur if there is a sustainable and
long-term improvement in the operating performance and capital strength
of Blue Whale and Pfizer. Conversely, negative rating actions could
occur as a result of material operational and performance issues at both
Blue Whale and Pfizer. Rating pressure would be likely if there were any
adverse changes to many of the regulatory standards to which Pfizer
adheres. The potential for future acquisitions, the associated
integration risks and company profile changes could lead to both
positive and/or negative pressure on the ratings, depending on the
A.M. Best remains the leading rating agency of alternative risk transfer
entities, with more than 200 such vehicles rated in the United States
and throughout the world. For current Best's Credit Ratings and
independent data on the captive and alternative risk transfer insurance
market, please visit www.ambest.com/captive.
The methodology used in determining these ratings is Best's Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best's rating process and contains the different rating criteria
employed in the rating process. Best's Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative
insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2014 by A.M. Best Company, Inc. ALL RIGHTS
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