AM Best Ratings for Cavello Bay Reinsurance Limited
AM Best, the credit rating agency, has assigned Cavello Bay Reinsurance Limited, a subsidiary of Enstar Group Limited based in Bermuda, a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of “a+” (Excellent), while both ratings come with a stable outlook.
These ratings reflect Cavello Bay’s robust financial position, with AM Best noting its very strong balance sheet. Additionally, the ratings acknowledge Cavello Bay’s strong operating performance, positive business profile, and sound risk management practices.
As Enstar’s primary operating entity, Cavello Bay holds the majority of the group’s assets and liabilities. Enstar, known for its established role in the run-off market, has extensive experience in managing claims across complex lines of business.
Enstar Acquisition by Sixth Street
In 2024, Enstar announced its acquisition by Sixth Street, although the company’s business model is expected to remain largely unchanged post-acquisition. AM Best has reviewed Enstar’s upcoming capital strategies and expects its balance sheet strength to remain stable throughout the closing of the acquisition and into 2025.
Should there be significant changes in Enstar’s financial plans, AM Best may adjust Cavello Bay’s ratings accordingly.
Comments from Enstar’s CFO
Matt Kirk, Enstar’s Group Chief Financial Officer, commented on the news, “The AM Best Financial Strength Rating reflects Enstar’s established standing in the global legacy market and is further confirmation of our strong capital position and the resilience of our business model.”
The “A” rating for Cavello Bay, our primary Bermuda reinsurer, affirms our commitment to insurance ratings and will enhance our ability to structure insurance transactions that support the strategic objectives of our partners.
