Despite the negative impact of the government's sovereign credit rating downgrade on its business, Colina Insurance Limited (CIL) secured a stable outlook from credit ratings company AM Best.

Colina Holdings Bahamas Limited (CHBL) Chairman Terry Hilts, in the company's 2022 annual report, noted AM Best's opinion that CIL has a good ability to meet its ongoing insurance policy and contract obligations despite the downgrade the company faced from A1 to B++.

"In 2022, following its annual review, CIL's AM Best credit ratings were negatively impacted by The Bahamas' sovereign ratings downgrade. AM Best acknowledged that CIL's balance sheet strength remained strong, as evidenced by its capital ratios which had been steadily increasing and were at their highest levels ever," he said.

"AM Best further assessed CIL's operating performance as strong, its business profile as neutral and its enterprise risk management as appropriate. Nevertheless, the company's financial strength rating (FSR) went from A- (Excellent) to B++ (Good). AM Best adjusted the outlook of CIL's ratings from negative to stable."

CHBL reported that it ended 2022 with total revenues up, at $180.8 million, compared to $174.6 million in 2021.

"The company's revenues reflected an increase over 2021 attributable to new lines of medical and general insurance business. Net premium revenues were $126.6 million for the 12 months ended December 31, 2022 compared to $116.1 million in the prior year. The company's general insurance company, Indigo, has had a full year of operations contributing positively to the complement of financial services offered by the group," the annual report noted.

"Revenues in 2022 also included a temporary boost in premiums from a COVID-related trip interruption product issued to assist travelers to The Bahamas until travel restrictions were fully lifted mid-2022. The new lines of business have had a modest impact on net policyholder benefits which totalled $91.7 million for the period, compared to $89.6 million in the prior year. In addition to insurance claims activity related to the general and medical insurance products discussed above, claims activity for 2022 reflected a full year of 'normalized' post-pandemic claims life and medical insurance activity. Additional net reserves of $12.1 million were booked during the period, reflecting the growth in business and changes in the actuarial liabilities."

Click here to read more at The Nassau Guardian