Source: insurancebusinessmag.com

AM Best has upgraded the financial strength ratings of Somerset Reinsurance and Somerset Reinsurance Company (SRC) to A (Excellent) from A- (Excellent) and raised their Long-term issuer credit ratings to “a” (Excellent) from “a-” (Excellent).

Somerset Re is based in Hamilton, Bermuda, while SRC operates out of Orlando, Florida. Both Somerset Re and SRC focus on providing reinsurance solutions for asset-intensive life insurance and annuity products. This includes programs for new business flow as well as the management of legacy blocks of life and annuity policies. The outlook for both companies’ ratings is now stable, revised from positive for Somerset Re and unchanged for SRC.

According to AM Best, the rating actions on Somerset Re and SRC reflect what the agency considers very strong balance sheet strength, adequate operating performance, a neutral business profile, and appropriate enterprise risk management. The upgrades also recognize the company’s execution of its business plan, with sustained profitability and premium growth trends. Somerset Re continues to secure reinsurance agreements annually with rated insurers as part of its plan, with experience-based metrics indicating disciplined pricing and investment management practices.

The ratings upgrade follows a period of increased transaction activity for Somerset Re. In early 2025, the company closed three separate reinsurance deals and had three more in progress, including a new business flow partnership for fixed index annuities, an in-force block transfer of corporate-owned life insurance, and a long-term disability reinsurance agreement. These transactions have been supported by additional equity funding from Aquarian Holdings, Somerset Re’s parent company, which has provided capital to expand its ability to write larger, more diversified blocks of business.