AM Best has affirmed the financial strength rating of A (Excellent) and the long-term issuer credit ratings of “a+” (Excellent) of the operating subsidiaries of Bermudian-based Axis Capital Holdings Limited.

The ratings agency also affirmed the long-term ICR of “bbb+” (Good) and the existing indicative long-term issue credit ratings of Axis Capital Holdings.

The outlook of these credit ratings is stable.

The ratings reflect Axis’ balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, favourable business profile and appropriate enterprise risk management from the group’s risk profile.

Axis maintains levels of risk-adjusted capitalisation, as measured by Best’s capital adequacy ratio, that place its balance sheet strength in the strongest category.

The group’s balance sheet strength assessment is bolstered by a favourable amount of financial flexibility at the holding company level and within the operating subsidiaries while also reflecting capital management strategies that have included consistent common and preferred dividends, as well as share repurchases.

Over the past 10-year period, reserves have consistently run off favourably.

Axis’ operating performance is assessed as adequate by AM Best, as the company’s underwriting results over the most recent five-year period have been volatile.

However, corrective measures Axis has implemented to address and reverse these trends were evident in the group’s most recent year-end results.

AM Best categorises Axis’ business profile as favourable, as the group consistently ranks in AM Best’s Global Reinsurance 50 largest reinsurance enterprises.

In 2022, Axis announced it will no longer underwrite property-catastrophe reinsurance business; however, the group also maintains a well-regarded profile as a specialty underwriter of complex risks with a significant presence in the Lloyd’s market.

The group’s ERM is sophisticated and embedded throughout the organisation. AM Best believes that Axis’ risk management is appropriate given its complex risk profile.

The FSR of A (Excellent) and the Long-Term ICRs of “a+” (Excellent) with stable outlooks have been affirmed for the following subsidiaries: Axis Specialty Limited, Axis Re SE, Axis Reinsurance Company, Axis Specialty Europe SE, Axis Surplus Insurance Company, and Axis Insurance Company.

The following indicative long-term IRs under the current shelf registration has been affirmed with stable outlooks: Axis Capital Holdings Limited -- “bbb+” (Good) on senior unsecured debt; “bbb” (Good) on subordinated debt; “bbb-” (Good) on preferred stock.