A.M. Best, a rating agency of alternative risk transfer entities, has affirmed the financial strength rating of 鈥楢鈥� (Excellent) and the long-term issuer credit rating of 鈥榓+鈥� (Excellent) for two BNY Mellon subsidiary insurance companies.
The outlook of these credit ratings is stable.
BNY Trade Insurance Ltd and The Hamilton Insurance Corp are single-parent captive insurers of the global financial services company.
A captive insurer is an insurance company that insures the risks of an associated business 鈥� in this case, the parent corporation of BNY Mellon. Captive insurance is an alternative risk transfer arrangement suited for risks unique to an organisation that lack appropriate, accessible or affordable coverage in the commercial insurance market.
In this capacity, BNY Trade and Hamilton provide BNY Mellon with comprehensive reinsurance coverage and products.
A.M. Best says that its ratings of both BNY Trade and Hamilton reflect their respective balance sheet strength, as well as strong operating performance, neutral business profile and appropriate enterprise risk management.
The rating agency notes that BNY Trade鈥檚 ratings also reflect its steady growth in surplus, fuelled by consistent premium growth and favourable profitability over the past few years. Similarly, Hamilton鈥檚 ratings are bolstered by its stable premium, strong liquidity and consistent level of investment income.
A.M. Best adds that BNY Trade and Hamilton both benefit from BNY Mellon鈥檚 robust enterprise-wide policies and procedures concerning risk management, resiliency, corporate governance and compliance.
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