AM Best Affirms Credit Ratings of Delvag Versicherungs-AG

AMSTERDAM–(BUSINESS WIRE)–#insurance–AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) for Delvag Versicherungs-AG (Delvag) (Germany). The outlook of these Credit Ratings (ratings) is negative.

These ratings reflect Delvag’s balance sheet strength, which AM Best assesses as very strong, its strong operating performance, neutral business profile, appropriate enterprise risk management, as well as rating drag due to its association with the financially weaker parent, Deutsche Lufthansa Aktiengesellschaft (Lufthansa). The negative rating outlook reflects uncertainty relating to the continued impact of the COVID-19 pandemic on Lufthansa’s core business and credit profile, which weakened as a result from a decline in aviation traffic.

Delvag is the captive insurer for Lufthansa, a global aviation group domiciled in Germany.

The captive’s balance sheet strength is underpinned by risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), which remained at the strongest level at year-end 2020. AM Best expects the captive’s prospective risk-adjusted capitalisation to be maintained at the strongest level further supported by a profit and loss absorption agreement with Lufthansa that provides Delvag with added balance sheet protection. The balance sheet strength assessment also factors in Delvag’s conservative and prudent reserving practices, as well as its good liquidity profile. A partly offsetting rating factor is Delvag’s moderately high dependence on reinsurance to protect its aviation fleet business. However, the associated credit risk is mitigated by the use of a financially strong and diverse reinsurance panel.

Delvag has a good historical earnings track record, as demonstrated by a five-year weighted average operating ratio of 72% (2016-2020), as calculated by AM Best, supported by a good balance of underwriting and investment income. Delvag recorded strong and improved technical performance in 2020, as demonstrated by a combined ratio of 93% (as calculated by AM Best), compared with 99% in the prior year. AM Best expects the company to maintain this improved level of underwriting performance following remedial actions undertaken in 2020 on underperforming lines of business, as well as partial discontinuation of non-group-related reinsurance business.

Delvag’s profile is enhanced by its strategic importance to and integration within the Lufthansa group. It continues to leverage its expertise in the aviation and transport sectors to write a book of third-party business alongside its core Lufthansa fleet portfolio.

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

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 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 specialising 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

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


Konstantin Langowski
Senior Financial Analyst
+31 20 308 5431

Dr. Angela Yeo
Senior Director, Analytics
+31 20 308 5421

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159

Jim Peavy
Director, Communications
+1 908 439 2200, ext. 5644

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