S&P put 15 insurers on watch

S&P said placed its long-term issuer credit ratings on 15 nonoperating holding companies (NOHCs) of Bermuda-based reinsurers and insurers on CreditWatch with negative implications. It also placed the issue ratings on the securities issued or guaranteed by these NOHCs on CreditWatch negative

The agency said it reviewing its base-case assumptions on the potential regulatory restrictions to payments from Bermuda-based operating re/insurance companies to NOHCs and the possible mitigants to these restrictions under its group rating methodology.

“Our view of the potential regulatory restrictions to payments is relevant for our assessment of debt-funded capital credit for debt issuances under our updated capital model criteria,” S&P said in a press release.

The agency usually rates NOHCs of insurance groups two notches under their core operating units if potential restrictions to payments are low and three notches if high.

The companies are Arch Capital Group Ltd., Ascot Group Ltd., Aspen Insurance Holdings Ltd., Highlands Holdings Bond Co-Issuer Inc., and Highlands Holdings Bond Issuer Ltd., AXIS Capital Holdings Ltd., Enstar Group Ltd., Fidelis Insurance Holdings Ltd., Hiscox Ltd., Lancashire Holdings Ltd., RenaissanceRe Holdings Ltd. and DaVinciRe Holdings Ltd., and SiriusPoint Ltd.

“If, in our view, the enforcement of regulatory rules results in a higher likelihood of restrictions on the upstreaming of cash flow, then we will likely lower the ratings on the NOHCs, and the ratings on the instruments issued or guaranteed by these NOHCs, by one notch,” S&P warned.

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