AM Best Affirms Credit Ratings of Seguros G&T, S.A.

AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of Seguros G&T, S.A. (SG&T) (Guatemala). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect SG&T’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

SG&T was established in 1947 and is the second-largest insurer in Guatemala, with a market share of 13%. The company’s product portfolio is composed mainly of property/casualty (66%), accident & health (24%) and life (10%), as of December 2023. SG&T holds very competitive positions across most lines of business within Guatemala’s insurance industry due to its permanence and brand recognition.

SG&T is owned privately by GTC Investments, Ltd. (GTC), the non-operating holding company of the Grupo Financiero G&T Continental financial conglomerate.

AM Best views SG&T’s business profile as neutral, based on the company’s top market position, brand recognition and experienced management. AM Best’s stable market segment outlook on Guatemala’s insurance industry recognizes its strong economy and SG&T’s technical capabilities to produce the best result in the past five years. The company’s technical and managerial capabilities continue to support its strategy in the core segment while continuously looking to diversify into profitable lines.

AM Best assesses SG&T’s balance sheet strength at the strongest level, due to its capacity to protect its balance sheet as reflected in AM Best’s risk-adjusted capitalization assessment of strongest, as measured by Best’s Capital Adequacy Ratio (BCAR); these factors are driven by sound capital management including a comprehensive reinsurance program, conservative investment portfolio and appropriate asset liability management practices. The company reports consistently profitable results, which are reflected in its growing capital base.

AM Best considers SG&T’s operating performance as adequate, as technical results for year-end 2023 remained positive, backed by improvements in most of its business lines. The adequate assessment also considers the company’s efforts to continue creating savings and efficiencies on the expense side while aiming to improve underwriting quality. AM Best will continue to monitor SG&T’s operating performance, as the competitive environment in Guatemala’s market continues to evolve.

The stable outlooks reflect SG&T’s technical capabilities to maintain profitable underwriting while it continues to reformulate key offerings.

Negative rating actions could occur if SG&T’s operating performance deteriorates as a result of pressures in the quality of underwriting or from a downturn in the economic cycle. Negative rating actions also could take place if the company’s risk-adjusted capitalization deteriorates due to catastrophe events substantially affecting its capital base. Positive rating actions could take place if SG&T’s operating performance continues to trend positively while maintaining stability in its risk-adjusted capitalization at the current level of strongest, as measured by BCAR.

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 specializing 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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