New Bermudian reinsurer Vantage Risk Ltd has been given an A- (excellent) financial strength rating and a long-term issuer credit rating of “a-” by AM Best. The outlook assigned for the credit ratings is stable.
The ratings reflect Vantage’s balance sheet strength, which AM Best categorised as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
Vantage plans to expand into primary insurance lines and operate as Vantage Group. Dinos Iordanou, formerly of Arch Capital Group Ltd., will serve as a non-executive chairman for the greater group, with Greg Hendrick, formerly of Axa XL, serving as the group’s chief executive officer. In addition, the group has appointed Chris McKeown and Jack Kuhn to run the reinsurance and insurance operations, respectively. Aurora Swithenbank, formerly of Goldman Sachs, has been hired to serve as the group’s chief financial officer.
AM Best said the very strong balance sheet assessment is based on Vantage’s financing structure that projects supportive risk-adjusted capital that meets its guidelines for newly formed organisations.
The rating agency assessed Vantage’s operating performance as adequate based on “the clearly defined business plan that contemplates a level of implementation and execution risk for a newly formed entity”.
In addition, AM Best said it viewed Vantage’s business profile as limited, given the execution risk associated with entering a highly competitive market. It said: “This risk is mitigated somewhat by the management team’s strong track record in the insurance and reinsurance industries. Furthermore, Vantage’s business profile assessment reflects that, as a new market entrant, the company will require a period to establish its brand and market position.
“A clearly defined ERM structure includes risk appetite and tolerance statements that focus on concerns specific with Vantage’s business profile. The company’s risk management benefits from the depth and breadth of the procedures and policies designed by the experienced management team.”