AM Best has affirmed the Financial Strength Rating of A (Excellent), the Long-Term Issuer Credit Rating of “a+” (Excellent) and the Mexico National Scale Rating of “aaa.MX” (Exceptional) of MAPFRE Fianzas, S.A. (MAPFRE Fianzas) (Mexico City, Mexico). The outlook of these Credit Ratings (ratings) is stable.

MAPFRE Fianzas is a member of MAPFRE S.A. (MAPFRE), which on a consolidated basis has a balance sheet strength that AM Best assesses as very strong, as well as strong operating performance, favorable business profile and appropriate enterprise risk management (ERM).

The ratings reflect MAPFRE Fianzas’s strategic importance within MAPFRE Internacional S.A. and the benefits derived from the MAPFRE group’s global practices, synergies and operational efficiencies. As part of MAPFRE, MAPFRE Fianzas leverages its parent group’s expertise and international reach to strength its domestic performance.

The ratings also reflect MAPFRE Fianzas’s role as a complementary business line of MAPFRE México, S.A. (MAPFRE Mexico), as well as MAPFRE Fianzas’s strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR) on a consolidated basis, its consistent profitability at year-end 2024 and solid reinsurance program. Partially offsetting these positive rating factors are the company’s low participation within Mexico’s surety market and limited growth potential in the country’s slowing economic environment.

While MAPFRE Fianzas is a legal subsidiary of MAPFRE Mexico, its strategy and operations serve as a boutique business line focused on maintaining market presence and complementing the services provided by MAPFRE. The company holds a small market share (1.6%), within Mexico’s surety industry, based on gross premium written, with its portfolio composed mainly of administrative, judicial, and credit and fidelity businesses.

In 2024, the company’s underwriting performance remained solid, supported by a contained loss ratio of 14.3% and a combined ratio of 77%. The increase in claims was offset by improved expense management with a 26.1 percent increase in net premiums written from the previous year. The company continues to prioritize low-risk and profitable segments, while maintaining a selective approach toward large accounts. However, Mexico’s operating environment remains challenged by a contraction in public expenditures.

MAPFRE Fianzas’ strongest level of risk-adjusted capitalization remains underpinned by its profit retention and consistent operating performance in 2024. Despite the increase in premium volume, the company remains vulnerable to adverse market conditions and claims deviations, which limits AM Best's view of the ratings. However, MAPFRE Fianzas’s appropriate reinsurance program, provided by Solunion Seguros Compañia Internacional de Seguros y Reaseguros S.A., partially offsets AM Best’s view.

MAPFRE Fianzas’ ERM practices are well-established and implemented throughout the company and closely follow those set by MAPFRE S.A. and are aligned with MAPFRE Mexico.

If negative rating pressure develops as a result of a deterioration in operating performance metrics of the MAPFRE group, below those commensurate with the strong assessment or following a notable deterioration in balance sheet strength to a level no longer supportive of the very strong assessment, the ratings of MAPFRE Fianzas would mirror those actions. Positive rating factors could develop should the group successfully expand its profile whilst maintaining strong operating performance and the very strong balance sheet fundamentals, in which case, the ratings of MAPFRE Fianzas would move in tandem. A change in AM Best’s perception regarding the actual or perceived level of MAPFRE Fianzas´s strategic importance to the MAPFRE group also could impact the company’s ratings.

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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