AM Best has affirmed the Financial Strength Rating of B (Fair) and the Long-Term Issuer Credit Rating of “bb+” (Fair) of East Africa Reinsurance Company Limited (EARe) (Kenya). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect EARe’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management. In addition, the ratings reflect a neutral impact from EARe’s ultimate parent, Asset Managers Limited, a non-operating holding company, which owns several other insurance companies and has non-insurance operations in Kenya.
EARe’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which was comfortably at the strongest level at year-end 2025, as measured by Best’s Capital Adequacy Ratio (BCAR). AM Best expects EARe to maintain healthy capital buffers in excess of the strongest threshold, benefitting from its low underwriting leverage and the ongoing derisking of its investment portfolio. An offsetting rating factor is EARe’s exposure to the very high levels of political risk and the high levels of economic and financial system risks in Kenya, where the company is domiciled and approximately 80% of its assets are invested. Nevertheless, the company is executing a derisking strategy and diversifying its investment portfolio, including the reinvestment of assets abroad into fixed-income securities in the United States and Tanzania.
EARe has a track record of adequate operating performance, with return-on-equity ratios moderately exceeding inflation rates in Kenya over the past five years. Prudent underwriting has supported improved underwriting performance in recent years, with the company reporting a net/net combined ratio of 95.3% in 2025, representing its fourth consecutive year of sub-100% combined ratios. Investment income is expected to remain the primary contributor toward overall earnings, reflecting the favourable interest rates offered by domestic issuers in Kenya.
EARe is a small reinsurer by global standards, with insurance service revenue of USD 57 million in 2025. The company has a geographically diverse portfolio mix across Africa, though premium volumes are derived primarily from East African markets.
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.
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