AM Best Affirms Credit Ratings of Nissan Global Reinsurance, Ltd.

AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Nissan Global Reinsurance, Ltd. (NGRe) (Hamilton, Bermuda). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect NGRe’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The neutral business profile considers NGRe’s strategic role as a captive insurer for its parent, Nissan Motor Co., Ltd. (Nissan) [NASDAQ: NSANY].

The balance sheet strength assessment is supported by NGRe’s level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), at the strongest level. While the company continues to generate strong annual earnings, the captive’s total surplus has declined over the past five years as its dividends returned to the parent have exceeded its earnings. However, the company has ample liquidity with favorable cash flows for the captive’s selected risks and exposures. NGRe’s adequate operating performance assessment reflects consistently favorable annual combined and operating ratios compared with industry averages, excellent revenue returns, and double-digit equity returns. In its role as a single-parent captive for Nissan, one of the largest automakers in the world, NGRe provides Nissan with a host of insurance coverages in the United States and abroad, including, but not limited to, extended service contracts, product liability and inland marine. As a member of the Nissan family of companies, NGRe benefits from the group’s proprietary data warehouse, extensive risk management practices and loss control programs.

The stable outlooks reflect AM Best's expectation that the captive will maintain its very strong balance sheet strength supported by risk-adjusted capitalization at the strongest level, as measured by BCAR, through continued favorable operating results. AM Best expects there will not be changes in the parent’s ability or willingness to support the captive even as it periodically returns excess capital to the parent.

AM Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

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 specializing 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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