AM Best Affirms Credit Ratings of Nacional de Reaseguros, S.A.

AMSTERDAM–(BUSINESS WIRE)–AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” of Nacional de Reaseguros, S.A. (Nacional) (Spain). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Nacional’s balance sheet strength, which AM Best categorises as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

Nacional’s risk-adjusted capitalisation remains at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), supported by strong internal earnings generation and modest underwriting leverage. The company’s balance sheet strength assessment also reflects its prudent reserving approach and limited catastrophe exposure, as most natural perils in Spain are covered by the Consorcio de Compensación de Seguros, the compulsory government natural catastrophe scheme covering physical damage. AM Best expects the company’s prospective capital position to benefit from high earnings retention, underpinned by a prudent dividend policy.

Nacional’s disciplined underwriting approach and limited exposure to natural catastrophes have contributed to consistently strong technical results, demonstrated by a five-year (2015-2019) weighted average combined ratio of 93.2%. In 2019, the company’s loss ratio remained relatively stable at 63.2% compared with 62.4% in 2018. This represents an improvement over 2017 (loss ratio of 67.8%) when results were dampened by natural catastrophe losses in territories outside of Spain. The company’s 2019 profit after tax increased 9% to EUR 40.2 million.

Nacional maintains a strong competitive position as a leading independent reinsurer in Spain. Gross written premium increased by 4.1% to EUR 591 million in 2019, driven by the growth of Spain’s insurance market and Nacional’s steady growth in European markets outside of Spain. Nacional has expanded its international activities successfully in recent years, targeting small-to-medium sized insurers and mutual companies in Europe. In 2019, foreign business accounted for 34% of Nacional’s total premium (compared to 27% in 2014), improving the geographical diversification of its portfolio. Nonetheless, uncertainties exist regarding the long-term profitability of business outside of Spain, owing to higher levels of competition from global reinsurers. AM Best believes that Nacional’s expansion outside of its domestic market represents a source of potential volatility to the company’s performance on a gross basis due to the exposure of this business to catastrophe losses. However, the company has demonstrated its ability to manage its catastrophe exposures through a comprehensive retrocession programme and, more recently, the acquisition and development of specialised risk management tools.

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 media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media – Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

Copyright © 2020 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


Giannina Carbajal Ortiz

Financial Analyst, MBA

+31 30 308 5428

Michael Dunckley, CFA
Associate Director, Analytics
+31 20 308 5422

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

Jim Peavy

Director, Public Relations

+1 908 439 2200, ext. 5644

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