Bermudian-based Essent Group Ltd has announced that S&P Global Ratings has raised its long-term insurer financial strength and issuer credit ratings on its wholly owned subsidiaries, Essent Guaranty Inc and Essent Reinsurance Ltd to ‘A-’ from ‘BBB+’, with a stable outlook.

A spokesman for the holding company said: “S&P’s rationale in support of the ratings upgrade includes an improved view of Essent’s capital adequacy resulting from the implementation of S&P’s revised capital adequacy methodology, its expectation of Essent’s ability to generate solid underwriting earnings that should be capital accretive, and Essent’s mortgage insurance portfolio with strong underwriting quality, significant home equity cushion, and substantial reinsurance protection.”

Mark Casale, chairman and chief executive officer, said: “We are very pleased with the S&P ratings upgrade and reaching another milestone of A- or higher financial strength ratings by all rating agencies for both Essent Guaranty and Essent Re.

“The upgrade reflects our strong balance sheet and profitability, and the benefits of transformative changes to our business, including post-GFC regulatory guardrails, increased use of risk-based pricing engine and programmatic reinsurance, which have made Essent a stronger and more sustainable franchise.”