Three weeks after the completion of Bermudian-registered Sagicor Financial Company Ltd’s acquisition of ivari from Wilton Re Ltd, AM Best has reconsidered its ratings of the company and its subsidiaries.

Sagicor Financial said on October 3 that it had completed its previously announced deal to purchase ivari, a national network of thousands of independent advisers in Canada, providing a full range of insurance products, including permanent and temporary insurance solutions and critical illness coverage.

AM Best has responded by removing from under review with developing implications and affirming the financial strength rating of A- (Excellent) and the long-term issuer credit ratings of “a-” (Excellent) of four subsidiaries of Sagicor Financial.

They are Sagicor Reinsurance Bermuda Ltd, Sagicor Life Inc and Sagicor General Insurance Inc (both domiciled in Barbados), and Sagicor Life Insurance Company of Austin, Texas.

Concurrently, the ratings agency has removed from under review with developing implications and affirmed the FSR of B++ (Good) and the Long-Term ICR of “bbb+” (Good) of Sagicor Life Jamaica Limited.

The outlook assigned to these credit ratings is stable.

In addition, AM Best has removed from under review with developing implications and affirmed the Long-Term ICR of “bbb-” (Good) and the Long-Term Issue Credit Rating of “bbb” (Good) on the $400 million, 5.3 per cent senior unsecured notes, due 2028, of Sagicor Financial.

The outlook assigned to these ratings is stable.

AM Best also has downgraded the FSR to A- (Excellent) from A (Excellent) and the Long-Term ICR to “a-” (Excellent) from “a+” (Excellent) of Toronto-based ivari. Concurrently, AM Best has maintained the under-review status for these ratings and revised the implications status to developing from negative.

The ratings of Sagicor Reinsurance Bermuda Ltd reflect its 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. The ratings benefit from a capital maintenance agreement with Sagicor Financial.

The ratings of ivari reflect its balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, neutral business profile and appropriate ERM.

AM Best notes that ivari’s ratings are impacted adversely with the sale to Sagicor, as the company no longer receives the benefit of a group rating from being a member of the Wilton Re Group, which is ultimately owned by the Canada Pension Plan Investment Board.

AM Best notes that the transaction will be accretive to Sagicor Financial Company Ltd’s operating earnings and increase its geographic diversification while lowering its overall investment risk.

However, there is some uncertainty concerning the integration risk from the acquired block of business.

AM Best said it will continue to monitor this integration of ivari and provide updates as conditions warrant.