Somewhat offsetting these positive rating factors are the organization’s exposure to large catastrophe losses. As part of its catastrophe management process, Everest Re utilizes catastrophe modeling and establishes risk limits to control catastrophic exposures on both a probable maximum loss (PML) and aggregate basis, although catastrophe losses could impact earnings in any given year. The organization also maintains net asbestos and environmental (A&E) exposure of approximately $480 million, which has been declining in recent years. A&E reserves are monitored on a quarterly basis against emerging trends with the most recent review indicating that current reserve levels are adequate.
Rating factors that could lead to a positive outlook and/or rating upgrades include the continuation of Everest Re’s long-term, consistently strong operating profitability relative to its peers as well as maintaining strong risk-adjusted capital levels.
Rating factors that could lead to a revised outlook to negative and/or a downgrading of the company’s ratings include unfavorable operating profitability trends, outsized catastrophe or investment losses relative to peers and/or A.M. Best’s expectations, significant adverse loss reserve development and/or a material decline in its risk-adjusted capital.
The FSRs of A+ (Superior) and ICRs of “aa-” have been affirmed for Everest Reinsurance (Bermuda) Ltd. and its following reinsurance and insurance subsidiaries:
- Everest Reinsurance Company
- Everest International Reinsurance, Ltd.
- Everest Reinsurance Company (Ireland), Limited
- Everest National Insurance Company
- Everest Indemnity Insurance Company
- Everest Security Insurance Company
- Everest Insurance Company Canada