AM Best Removes From Under Review With Developing Implications and Affirms Credit Ratings of SCOR SE and Its Main Operating Subsidiaries

AM Best has removed from under review with developing implications and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICRs) of “a+” (Excellent) of SCOR SE (SCOR) (France) and its main operating subsidiaries. The outlook assigned to these Credit Ratings (ratings) is stable. [See below for a detailed listing of companies and ratings.]

The ratings reflect SCOR’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, very favourable business profile and appropriate enterprise risk management.

The ratings have been removed from under review as AM Best has completed its assessment of the impact of SCOR’s life reserving review and new strategic plan for life and health (L&H) business on its rating fundamentals. The ratings were initially placed under review with developing implications on July 24, 2024, following SCOR’s publication of an update on its second-quarter 2024 and full-year 2024 results. The group also announced a reserving and assumptions review for the L&H activities, which was completed in third-quarter 2024. On December 12, 2024, SCOR announced its revised strategic plan for its L&H activities, which includes a significant shift in the L&H business mix, with the group planning to reduce its exposure to protection products and increase its exposure towards longevity lines, as well as financial solutions.

The L&H insurance service result (ISR) for the first nine months of 2024 stands at a loss of EUR -467 million, due to a negative effect of EUR 0.7 billion tied to the review. Consolidated net income for the first nine months of 2024 amounted to EUR -229 million, supported by robust technical income in the property & casualty segment, as well as investment income. Reserving assumption changes impacted the organisation’s pre-tax L&H contractual service margin (CSM), with a negative adjustment (at current yield curves) of EUR 0.8 billion as per third-quarter 2024. The group published updated performance targets on 12 December 2024, and AM Best expects prospective performance to remain supportive of the adequate operating performance assessment.

AM Best expects SCOR’s risk-adjusted capitalisation for year-end 2024 to decline as a result of the reduction in earnings and CSM, but to remain supportive of the strong balance sheet strength assessment. Risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR) was at the very strong level at year-end 2023. The group benefits from a conservative investment portfolio and a robust retrocession programme designed to shield its capital base, which includes a new whole account stop loss protection for the 2025-2027 period. A partially offsetting factor is SCOR’s reliance on soft capital components, which includes hybrid debt, value of in-force life business and a contingent capital facility.

SCOR continues to maintain its prominent position as one of the top global reinsurers, with excellent product and geographic diversification. The group’s internationally recognised franchise, long-standing client relationships and technical expertise help SCOR manage local and global reinsurance market cycles.

The FSR of A (Excellent) and the Long-Term ICRs of “a+” (Excellent) have been removed from under review with developing implications and affirmed with assigned outlooks of stable for SCOR SE and its following operating subsidiaries:

• SCOR UK Company Limited
• SCOR Reinsurance Asia-Pacific Pte Ltd
• SCOR Global Life USA Reinsurance Company
• SCOR Global Life Americas Reinsurance Company
• SCOR Global Life Reinsurance Company of Delaware
• SCOR Reinsurance Company
• SCOR Canada Reinsurance Company
• General Security National Insurance Company
• General Security Indemnity Company of Arizona

The following Long-Term Issue Credit Ratings were removed from under review with developing implications and affirmed with assigned outlooks of stable:

SCOR SE—

-- “a-” (Excellent) on EUR 500 million 3.625% subordinated notes, due 2048

-- “a-” (Excellent) on EUR 600 million 3.00% subordinated notes, due 2046

-- “a-” (Excellent) on EUR 250 million 3.875% perpetual subordinated notes

-- “a-” (Excellent) on EUR 250 million 3.25% subordinated notes, due 2047

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.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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