AM Best, the credit rating agency, has upgraded the credit ratings of Kuwait Reinsurance Company K.S.C.P. (Kuwait Re), citing its improved financial performance and strong capital position.
The company’s Financial Strength Rating has been elevated from A- to A (Excellent), and its Long-Term Issuer Credit Rating has been upgraded from “a-” to “a”.
The outlook for both ratings has been set to stable, revised from the previous positive designation. Kuwait Re is majority-owned by Al Ahleia Insurance Company S.A.K.P.
The upgraded ratings reflect Kuwait Re’s consistently strong financial results, a solid capital base, steady internal performance, and well-managed risk exposure.
Over the past few years, the company has demonstrated a meaningful rise in profitability, with return on equity increasing to 16.5% in 2024 compared to 9.5% in 2020.
This improvement has been largely supported by strong underwriting practices and conservative reserving, which have helped provide a safeguard against potential market swings. AM Best expects these practices to continue driving solid financial outcomes in the near term.
Kuwait Re’s capital strength remains a key factor in the ratings decision. The company maintains a high level of capital adequacy as measured by AM Best’s Capital Adequacy Ratio (BCAR), reflecting a strong ability to absorb risk.
This is supported by a proven track record of retaining earnings, cautious reserving, and reliable liquidity. However, a portion of the investment portfolio—approximately 13% at the end of 2024—is allocated to higher-risk holdings, including real estate and equities, which could introduce some volatility.
The company also benefits from a broad and diverse operational footprint. Its reinsurance activities span several regions, including the Middle East, North Africa, Asia-Pacific, and Central and Eastern Europe.
Kuwait Re offers both proportional and non-proportional coverage to clients across these markets. In 2024, the company reported KWD 79.9 million (USD 260.1 million) in insurance revenue, a 10% increase from the previous year, reflecting both market opportunities and effective execution.
With solid earnings, a strong balance sheet, and growing international presence, Kuwait Re is well-positioned for continued stability. The revised outlook indicates AM Best’s confidence in the company’s ability to maintain its current momentum and financial discipline.
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