Marubeni captive rating affirmed

The captive of Japanese trading company Marubeni has had its A- financial strength rating affirmed by AM Best. 

The ratings agency said the outlook for Micronesia-based Marble Re was stable.

AM Best said the  single parent captive had recorded consistently strong operating performance with a five-year average combined ratio of 59% (2019-2023). 

It said for the fiscal year ended March 31, 2024, the company recorded moderate growth in both premium income and net profit, while its combined ratio remained stable and below 55%. 

"While moderate volatility exists in its major business line, marine cargo insurance, primarily due to a high correlation with the trading business of its parent, Marubeni Corporation, Marble Re’s underwriting profitability metrics have been relatively stable mainly due to stringent underwriting guidelines and a conservative reinsurance programme that help reduce potential underwriting volatility," AM Best said. 

"The company has made a strategic decision recently to raise the net retention limit for its non-marine business. Nevertheless, the company’s overall underwriting profitability is expected to remain stable given the historically low loss ratio of the existing business and its modest contribution to the total portfolio."

It said the company’s capital base was small but was considered to be sufficient, supported by low net underwriting leverage and minimal investment risk due to a highly liquid and conservative investment portfolio. 

"Although the company’s reinsurance dependency is moderately high, the risk is mitigated by its high quality and well-diversified reinsurance panel," it said. 

It said Marble Re continued to explore further diversification of its business portfolio, marine cargo will remain the company’s primary focus in the intermediate term. 

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