AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating (FSR) of B (Fair) and the Long-Term Issuer Credit Rating of “bb+” (Fair) of WAICA Reinsurance Corporation PLC (WAICA Re) (Sierra Leone).

The Credit Ratings (ratings) reflect WAICA Re’s balance sheet strength, which AM Best assesses as strong, as well as its strong operating performance, limited business profile and marginal enterprise risk management.

WAICA Re is a composite reinsurer writing business in more than 90 countries, with a business profile benefitting from a relatively diversified underwriting portfolio. The revision of the outlooks to positive from stable reflects AM Best’s expectation that WAICA Re will continue to develop its market profile and deliver strong operating results.

WAICA Re’s balance sheet strength is underpinned by risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), which remained comfortably at the strongest level at year-end 2024. The buffer in risk-adjusted capitalisation in excess of the strongest level increased at year-end 2024, as compared with year-end 2023, due to strong organic growth and improved asset quality. Investment risk has reduced in recent years as the company increased the allocation of its investments into territories with low country risk exposure. However, WAICA Re remains exposed to significant economic, political and financial system risks associated with the majority of its assets held in sub-Saharan Africa.

AM Best views WAICA Re’s operating performance as strong considering the company reported robust return-on-equity (ROE) ratios in recent years that have significantly exceeded the benchmark interest rates in the markets where it operates. WAICA Re’s earnings are underpinned by a solid technical performance, reflecting the company’s expertise and discipline in writing treaty and facultative business. AM Best expects WAICA Re’s prospective earnings to remain strong, underpinned by robust technical performance and positive, albeit modest, investment returns, reflecting the low-yielding assets in which the company primarily invests.

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