AM Best has affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” (Good) of Continental Reinsurance Plc (CRe Nigeria) (Nigeria), a wholly owned subsidiary of Continental Reinsurance Holdings Limited (CRe) (Botswana), the operating holding company of the Continental Re group. CRe Nigeria consolidates all the operating reinsurance subsidiaries of CRe. The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect CRe’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and marginal enterprise risk management. CRe Nigeria’s ratings factor in the company’s strategic importance to CRe.

CRe’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which is expected to remain at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). The group’s core subsidiary, CRe Nigeria, has had BCAR scores consistently in excess of the threshold for the strongest assessment between 2020 and 2024. However, the group’s risk-adjusted capitalisation has been volatile, driven in part by rapid business growth and material devaluations of the Nigerian naira, particularly in more recent years. CRe has taken steps to improve its capital management capabilities and is targeting more moderate growth over the medium term. The ratings consider CRe’s high exposure to the elevated levels of economic, political and financial system risk associated with its main operating markets in Africa. However, AM Best views these risks to be mitigated partially by the group’s good geographical diversification of revenue and assets. Since 2023, CRe Nigeria has been investing surplus assets offshore, namely in U.S. treasuries, thus improving the overall credit quality of the group’s investments. As at half-year 2025, offshore investments amounted to almost 25% of CRe Nigeria’s total investments (2022: 0%).

CRe’s adequate operating performance assessment reflects CRe Nigeria’s overall profitability considering inflationary conditions across key operating markets. In 2024, CRe Nigeria reported a return-on-equity (ROE) ratio of 7.9% (2023: 24.6%). AM Best notes that a material portion of the movements in fair value of investments, including FX gains, is reported via other comprehensive income. When taking this into consideration, the company’s adjusted ROE improves considerably to 44.6% (57.9%), driven by material FX gains associated with its long U.S. dollar position. CRe Nigeria’s non-life underwriting results have improved since 2020 as part of ongoing portfolio remediation efforts and economies of scale, evidenced by annual combined ratios in the mid-90s since 2020 (net/net combined ratio of 95.1% in 2024). AM Best expects CRe Nigeria’s underwriting performance in 2025 and beyond to trend in line with recent years, supported by stricter underwriting guidelines and more controlled business growth.

CRe is a composite reinsurance group with a diverse presence across more than 50 countries in Africa via CRe Nigeria. CRe Nigeria has grown significantly in local currency terms over recent years, with gross insurance revenue increasing 120% to NGN 248 billion in 2024 (or USD 161 million). AM Best expects a more controlled approach to growth over the longer term. However, further volatility in currency markets may affect reported levels of growth in the near term, as experienced in 2024.

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