AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” (Excellent) of Bahamas First General Insurance Company Limited (BFG) (Nassau, Bahamas) and Cayman First Insurance Company Limited (CFI) (Cayman Islands), the property/casualty (P/C) operating subsidiaries of Bahamas First Holdings Limited (Nassau, Bahamas) (BFH). The outlook of these Credit Ratings (ratings) is stable. These companies are collectively referred to as BFH.

The ratings reflect BFH’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

BFH’s balance sheet strength assessment is supported by it maintaining the strongest level of risk-adjusted capitalization, as measured by Best Capital Adequacy Ratio (BCAR). BFH has reported consistent capital growth and has a well-structured reinsurance program. Like most Caribbean insurance companies, BFH relies heavily on a highly rated reinsurance program to protect shareholder equity, which is reflected in the balance sheet strength assessment. Invested assets have historically had a high allocation to cash and cash equivalents, but over the past year the consolidated investment portfolio has shifted more toward fixed income securities mainly through investments held at CFI.

BFH’s operating results have faced challenges in recent years driven by unfavorable trends for the company’s Cayman health business. However, the companies have continued to report favorable underwriting results over the past five-year period with notable improvement in the health business and Bahamas P/C business over the past year. Underwriting profits reached a five-year high in 2024, as a result of improved loss ratios and top line growth. Investment income also improved during the year as a result of the shift in BFH’s asset allocation from cash to fixed income securities.

BFH maintains a strong market share in the Bahamas, where they are a leading P/C insurance provider, and has a growing market share in the Cayman Islands. Nevertheless, markets remain highly competitive and economies throughout the Caribbean remain economically challenged.

The ERM program for BFH is appropriate for its size and scope, with a well-established framework, including risk tolerances and a good governance structure. Additionally, BFH has a strong capital management policy for each entity that clearly defines measurables and internal targets.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

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