Bridgehaven Insurance, a recently launched hybrid fronting carrier, has secured an A- (Excellent) Financial Strength Rating and a Long-Term Issuer Credit Rating of “a-” (Excellent) from AM Best. The outlook assigned to these ratings is stable.
Launched in July 2023, Bridgehaven has a vision to become the leading UK hybrid fronting insurer of commercial & specialty lines, “creating a relationship with Managing General Agents (MGAs) and reinsurers woven together by mutual trust and collaboration.”
The UK-based company has the backing of Flexpoint Ford (Flexpoint), a private equity firm with significant experience investing in the insurance sector.
According to the credit rating agency, the assigned ratings reflect the company’s consolidated balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
The ratings also consider Bridgehaven Specialty’s role and strategic importance to Bridgehaven, as the group’s sole underwriting platform.
“The very strong balance sheet strength assessment considers Bridgehaven’s initial financing capital of £62.5 million, which is expected to support the strongest level of risk-adjusted capitalisation sufficiently, as measured by Best’s Capital Adequacy Ratio (BCAR), through the company’s startup phase,” said AM Best.
It added: “Due to its hybrid fronting business model, Bridgehaven is expected to have a high dependence on reinsurance; however, the reinsurance panel is anticipated to be well-diversified and of excellent credit quality. Investments are expected to be managed conservatively, in liquid assets.”
Bridgehaven is also expected to build relationships with established commercial specialty MGAs in the United Kingdom, for which it will provide insurance capacity, AM Best stated.
Over time, it added, the company aims to build a portfolio of diversified profitable business, with earnings primarily driven by fee income rather than underwriting or investment profit.
Paul Jewell, CEO of Bridgehaven, commented: “This rating is not only a testament to our financial strength and stability, but also a reflection of our team, governance and business model. We’re thrilled to see that our efforts have been recognised by such a reputable rating agency like AM Best.
“This rating allows Bridgehaven to stand out amongst our competitors and reaffirms to our clients our ability to meet policy and contractual obligations.”
AM Best expects execution risk to remain high in Bridgehaven’s initial years of operation.
