Financial services ratings agency, Moody’s, has upgraded the insurance financial strength rating of Odyssey Reinsurance Company and its subsidiaries to A2 from A3, on the back of strong underwriting results over the past few years.
Moody’s highlights that despite the impacts of catastrophe losses in both 2017 and 2018, the reinsurer, which is owned by Fairfax, recorded a combined ratio of 93.6% and 97.6%, respectively, which are far lower than some other companies during the period.
According to Moody’s, the firm’s strong results over the past several years is a reflection of the conservative management of its property catastrophe reinsurance exposures, and also favourable loss reserve development.
“In recent years, Odyssey Group has also improved its product and geographic diversification by opportunistically expanding premium volumes in selected specialty lines and geographic regions while maintaining good underwriting discipline,” says Moody’s.
The upgraded rating reflects the firm’s diversified product mix in both reinsurance and specialty lines, continued progress in business diversification across numerous locations, strong underwriting and solid capitalisation.
At the same time as upgrading the financial strength rating, Moody’s has revised Odyssey Re’s outlook to stable from positive.