AM Best affirms GIG Insurance Egypt credit rating at bbb+

AM Best affirmed on Wednesday GIG Insurance – Egypt’s (GIG-Egypt) financial strength rating of bbb+ (Good) and the long-term issuer credit rating of bbb+ (Good), with “stable” outlook.

“The ratings reflect GIG-Egypt’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.” AM Best explained in a statement.

“The ratings also factor in rating enhancement from GIG-Egypt’s parent company, Gulf Insurance Group K.S.C.P. (GIG), reflecting the strategic importance of GIG-Egypt to the group.”

In April 2023, GIG acquired AIG Egypt Insurance Company (AIG Egypt). Merger between GIG-Egypt and AIG Egypt is set to complete before the end of 2024.

“GIG-Egypt’s balance sheet strength is underpinned by its risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR).”

AM Best further said it expects GIG-Egypt’s consolidated risk-adjusted capitalisation to “remain at the strongest level.”
“The assessment also considers GIG-Egypt’s exposure to high levels of economic, political and financial system risks from operating exclusively in Egypt.”

GIG-Egypt has a record of generating strong earnings as it generated a five-year (2018-2022) weighted average return on equity of 24.6 percent and has an excellent underwriting record, with a five-year (2018-2022) average combined ratio of 84.9 percent.

It is the third-largest non-life insurer in the Egyptian market, as measured by gross written premiums, with a non-life market share of approximately 8 percent.