A.M. Best has affirmed the financial strength rating (FSR) of A (Excellent) and the issuer credit rating of “a” for San Juan-based MAPFRE PRAICO Insurance Company and an affiliate, MAPFRE Pan American Insurance Company, collectively known as the MAPFRE PRAICO Group (MPG). The outlook for each rating is stable.
“The ratings reflect MPG’s excellent capitalization, solid operating performance, long history of profitable underwriting results, established market presence within Puerto Rico and strong risk management practices,” the ratings agency said.
“The ratings also reflect MPG’s strong brand-name recognition within the Puerto Rico market and integral role as a member of MAPFRE S.A. (MAPFRE), one of the largest insurance groups in Spain,” the agency further noted.
Partially offsetting the positive rating factors is MPG’s geographic risk concentration, which exposes capital to the potential for frequent and severe weather-related events.
“Additionally, MPG’s operating almost exclusively within Puerto Rico exposes results to potential judicial, regulatory and economic changes. Despite these concerns, the outlooks reflect MPG’s excellent risk-adjusted capital position and solid operating results delivered over the long term,” A.M. Best said.
A.M. Best believes the current ratings of MPG are properly positioned and does not anticipate upward movement over the near term, it stated.
“However, negative rating actions could occur if there were a sustained deterioration in underwriting and operating performance, an occurrence of a sudden large catastrophic event that materially hinders risk-adjusted capitalization, or if the group’s relationship to its parent changes in a manner that negatively affects the operations of the group,” the agency concluded.