AM Best affirms Accredited rating

AM Best has removed from under review with developing implications and affirmed the financial strength ratings of A- of the Accredited companies, which were recently sold by Bermuda-based R&Q Investment Holdings to Onex Corporation for $420 million. 

The ratings agency said the outlook for the ratings of Accredited Specialty Insurance Company, Accredited Surety and Casualty Company and Accredited Insurance (Europe) are stable.

"The rating actions follow the completed acquisition of Accredited by funds managed by Onex Partners  from R&Q Investment Holdings on June 28, 2024," AM Best said. "Accredited will now operate as an independent programme management company providing insurance capacity in Europe, the United Kingdom and the United States. Accredited provides underwriting capacity to large managing general agents, connecting those entities with global reinsurance capital in exchange for a recurring fee. Onex confirmed that Accredited’s business strategy remains unchanged following the completed acquisition."

The ratings reflected Accredited’s balance sheet strength, which AM Best assessed as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. In addition, AM Best has increased Accredited’s Financial Size Category to IX based on its consolidated insurance operations under Accredited Insurance Holdings.

Accredited’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which is at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). AM Best expected that Accredited will maintain its strongest-level risk-adjusted capitalisation, as measured by BCAR, while generating profitable operating results and surplus growth in the near term.

R&Q was forced to go into voluntary liquidation to force through the sale of Accredited after the Bermuda Monetary Authority raise concerns about its reserves.

Mark Morrison, Charles Thresh and Mark Allitt of Teneo (Bermuda) were appointed as joint provisional liquidators of R&Q, after which the board of directors of R&Q resigned. 

The senior management of R&Q, including chief executive officer William Spiegel, were due to move with Accredited to Onex.     

"As a consequence of the provisional liquidation, it's anticipated that there will be very little, if any, chance of any value accruing to the company's shareholders," R&Q said on June 27.

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