AM Best has affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” (Good) of Compagnie Centrale de Réassurance (CCR) (Algeria). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect CCR’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, neutral business profile and marginal enterprise risk management.

CCR’s balance sheet strength is underpinned by the company’s strongest level of risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), supported by relatively low underwriting leverage and good internal capital generation. The company benefits from a state guarantee in the form of an interest-free loan facility, covering potential losses arising from Algeria’s compulsory natural catastrophe scheme written by CCR, net of retrocession. The assessment considers CCR’s significant exposure to the elevated levels of economic, political and financial system risk associated with Algeria, where the company is domiciled, holds over 95% of its invested assets and derives the majority of its business. Another partially offsetting rating factor is CCR’s moderate dependence on retrocession, which is used to protect the company against peak exposures, notably in Algeria. The associated risks are managed through the use of a panel of financially sound retrocessionaires.

CCR has a long-term track record of strong operating performance, with a five-year (2020-2024) weighted average return on equity of 14.7% (as calculated by AM Best). Operating results have been supported by strong technical results, evidenced by a five-year (2020-2024) weighted average combined ratio of 79.9% (as calculated by AM Best), driven by highly profitable domestic business. Earnings are supplemented by good investment returns, with a five-year (2020-2024) average investment yield (including gains) of 5.4%. AM Best expects underwriting profitability to remain robust prospectively, driven by a conservative underwriting approach and favourable domestic market conditions.

CCR’s neutral business profile reflects its dominant position in Algeria’s reinsurance market, with an estimated market share of 66% in 2024, as measured by ceded premiums. The company benefits from compulsory reinsurance cessions and leads most of its domestic reinsurance treaties. However, CCR’s scale is limited by global standards and the company’s business is concentrated in the Algerian market. In 2024, CCR wrote DZD 50 billion (USD 372 million) of gross written premium (GWP), of which 80% was generated in Algeria. The balance of GWP was represented by international business, which has been increasing gradually in recent years.

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