AM Best has placed under review with negative implications the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of "a-" of Canopius US Insurance, Inc. (Wilimington, DE) and Canopius Reinsurance AG (Switzerland). Both entities are wholly-owned subsidiaries of Canopius AG (Canopius) (Switzerland), the non-operating holding company of the Canopius group of companies.
AM Best expects Canopius' consolidated year-end 2018 risk-adjusted capitalisation to be significantly lower than previously anticipated, following worse-than-expected operating results for that year. The group is committed to implementing a number of actions in the short term to improve its risk-adjusted capitalisation to the strongest level, as measured by Best's Capital Adequacy Ratio (BCAR). The under review with negative implications status reflects the execution risk associated with the successful and timely implementation of these capital management actions, and the possibility that risk-adjusted capitalisation will not be restored to a level supportive of the current ratings.
AM Best is conducting detailed discussions with Canopius' management team regarding its capital and business plans, and will assess the impact of any capital management actions on the group's risk-adjusted capitalisation over the coming months.
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