Moody’s Affirms “Saudi Re” Financial Strength Rating at A3 and Upgrades Outlook from Stable to Positive

Moody’s, the international credit rating agency, has reaffirmed the Saudi Reinsurance Company “Saudi Re” with a financial strength rating of A3 on the global scale and an A1.sa rating on the local scale. This comes alongside a change in the outlook from stable to positive, as reported in their release.

Moody’s highlighted that the positive outlook reflects the agency’s expectation that Saudi Re’s business diversification and premium volumes will grow meaningfully over the next twelve to eighteen months, accompanied by increased capital to support the enlarged business.

The agency also noted that the Saudi Arabian economic diversification away from the hydrocarbon sector will have a positive impact on the insurance sector by stimulating increased demand for a broader range of insurance products. Furthermore, local legislation that gradually increases the mandatory cession, on a right of first-refusal basis, will have a positive impact on Saudi Re’s business profile and profitability.

According to Moody’s, the affirmation of Saudi Re’s rating reflects its strong brand and market position in Saudi Arabia as the sole Saudi professional reinsurer as well as its growing presence in its target markets of Asia, Africa and Lloyd’s. Saudi Re’s financial profile is underpinned by strong asset quality, resulting from its conservative investment strategy, good capital and reserve adequacy, along with good financial flexibility given its low leverage and good access to local capital markets.

Saudi Reinsurance Company (Saudi Re) is a publicly listed company on the Saudi Exchange (Tadawul) and operates under the supervision of the Saudi Central Bank. The company’s operations extend across more than 40 markets in the Middle East, Asia, Africa, and the Lloyd’s market in the United Kingdom. It enjoys a credit rating of A- from Standard & Poor’s (S&P) and an A3 rating from Moody’s. Saudi Re specializes in treaty and facultative reinsurance solutions in various insurance sectors, including engineering, property, marine, accidents, vehicles, life, and health insurance.