A.M. Best Rates Pfizer Insurance Captive A- Excellent

November 29, 2006

A.M. Best Co. has assigned a financial strength rating of A- (Excellent) to Blue Whale Re Ltd. of Burlington, Vermont. The rating outlook is stable.

A.M. Best said the rating reflects the company’s “strong capitalization and its conservative operating strategy.” The rating also considers Blue Whale Re’s “critical role and excellent profile as part of the Pfizer Inc. group, as well as Blue Whale Re’s favorable prospective operating performance based on the risk profile and historical results of its insurance programs.”

Partially offsetting these positive rating factors are the company’s very large gross and net underwriting exposures to property losses and its dependence upon reinsurance, according to the ratings firm.

Blue Whale Re is a single parent captive of Pfizer, the largest pharmaceutical company in the world. It insures Pfizer’s global property exposures, providing coverages with extremely large limits and its gross exposures per loss occurrence are elevated, according to A.M. Best.

Although Blue Whale Re benefits from significant reinsurance protection, its net retentions also remain very substantial, in A.M. Bests’s view. Its large policy limits also make it dependent upon reinsurance protection. Though reinsurance is provided by a large panel of reinsurers, Blue Whale Re relies on significant capacity to be able to support its obligations.

Nevertheless, A.M. Best said it recognizes the quality of the reinsurers and the substantial financial resources and support available to the captive as part of the Pfizer group.

Source: A.M. Best

Topics Reinsurance AM Best

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