Bermuda-based Arch Reinsurance is to take complete ownership of specialty reinsurer Gulf Reinsurance.
The reinsurer, which was founded jointly by Arch and Gulf Investment Corporation, was placed under review with negative implications by AM Best in September this year.
The rating agency has said that the under review status with negative implications of the financial strength rating of A- (Excellent) and the issuer credit rating of "a-" of Gulf Re has been extended pending further review of new strategic initiatives.
To further support Gulf Re’s business in advance of the January 1 renewal season, Arch is also entering into an uncapped 90 percent whole account quota share retrocession arrangement of Gulf Re’s net liabilities and a loss portfolio transfer of all of Gulf Re’s existing business, effective as of October 1, 2014. With these new agreements being implemented, Arch will cancel its existing stop loss agreement with Gulf Re.
“With the new strategic initiatives in place, we believe that Gulf Re is strongly positioned for opportunities in the marketplace. Gulf Re benefits from the substantial experience of its management team based in Dubai, which is led by Christian Vogel. Additionally, Gulf Re continues to be exceptionally well capitalised,” said Arch.
Arch Re, Gulf Re, Reinsurance, Bermuda, AM Best, Christian Vogel