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AM Best Affirms Credit Ratings of AzRe Reinsurance, OJSC

BY Business Wire | CORPORATE | 11/05/25 02:58 PM EST

LONDON--(BUSINESS WIRE)-- AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of ?bbb? (Good) of AzRe Reinsurance, OJSC (AzRe) (Azerbaijan). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect AzRe?s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and marginal enterprise risk management (ERM).

AzRe?s balance sheet strength is underpinned by its consolidated risk-adjusted capitalisation, consistently maintained comfortably above the minimum level required for the strongest assessment, as measured by Best?s Capital Adequacy Ratio (BCAR). The company continued to reduce its investment concentration in Azerbaijan by shifting its portfolio toward foreign fixed income securities, which accounted for 42% of total invested assets at the end of August 2025. A partially offsetting rating factor is the limited catastrophe retrocession cover in place on AzRe?s expanding international portfolio, though this business is well-diversified geographically.

AzRe has a consistent track record of strong operating performance. In 2024, the company reported a robust combined ratio (net-net) of 65.5% (2023: 63.6%) (as calculated by AM Best). Total earnings are supported by strong investment returns, reflective of the high-interest rate environment prevailing in Azerbaijan. AM Best expects the company?s operating performance to remain strong over the medium term, supported by good product diversification, albeit subject to potential volatility due to its exposure to large risks.

AzRe maintains one of the leading positions in its domestic reinsurance market. However, the company is a relatively small reinsurer by international standards. AzRe has taken steps to expand its offering in foreign markets, where it has the potential to benefit from increasing reinsurance premium rates, but also faces intense competition from players with more established profiles.

This press release relates to Credit Ratings that have been published on AM Best?s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best?s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best?s Credit Ratings. For information on the proper use of Best?s Credit Ratings, Best?s Performance Assessments, Best?s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best?s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright ? 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Source: AM Best

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

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