AM Best Affirms Credit Ratings of European Mutual Association for Nuclear Insurance

AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of the European Mutual Association for Nuclear Insurance (Emani) (Belgium). The outlook of these Credit Ratings (ratings) is stable.

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

Emani’s balance sheet strength is underpinned by risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), taking into account the mutual’s ability to make a supplementary capital call on its members. In the unlikely event of a full limit loss, there would be a material depletion of capital due to the large net line size offered by Emani to its members relative to its capital base. However, AM Best expects Emani to rebuild its capital position quickly due to its contractual right to call retrospective premium for six times each member’s annualised premium contribution. An offsetting factor in AM Best’s assessment is the mutual’s dependence on reinsurance to offer a large gross line size.

Emani has a track record of strong technical performance, demonstrated by a five-year weighted average combined ratio of 48.7% for the period ending in 2023. AM Best expects Emani’s prospective performance to be in line with historical norms, albeit subject to volatility, consistent with a claims profile that is dominated by an infrequent number of low to medium-size losses.

Emani has an established position in the nuclear energy sector, writing property and terror covers for nuclear facilities. The mutual has a competitive market position within the specialist nuclear energy insurance sector in Europe and provides capacity to over a third of nuclear operators globally. Emani’s position benefits from favourable market conditions, with demand for nuclear coverage expected to remain strong through the medium term. The mutual’s narrow focus and the high-risk nature of the business written are considered offsetting factors in the assessment.  

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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