Centriq receives rating upgrade

International ratings agency, Global Credit Rating Co. (“GCR”) has upgraded the domestic ZAR currency claims paying ability rating of Centriq Insurance Company Limited (“Centriq”) to A+ (single A plus) from A (single A) previously. In addition the rating was placed on positive outlook.

Centriq is a specialised insurer, concentrating on structuring risk financing solutions. This is mostly achieved through contingency policies or cell captive facilities. The insurer is a wholly owned subsidiary of Centriq Insurance Holdings Limited, forming the short term insurance arm of the Centriq Group, which originated from the merging of Santam Risk Finance Limited, Nova Risk Partners Limited (“Nova”) and Nova Life Partners Limited in 2005.

Centriq has made good progress in penetrating the ART market segment, initially on the back of Santam, but in recent years this has been extended to independently sourced premier cell captive clients. According to Susan Andrews of GCR, the incorporation of Nova business under the Centriq licence in 2008 bodes well for improved diversification amongst cell owners, as well as achieving enhanced cost efficiencies. Whilst contingency policies are subject to claims limitation and require low risk capital, the balance of the business (UMA / third party) requires more traditional market wide risk capital. In this regard, the adjusted solvency level for the promoter cell amounted to 18.2% in F06, which was above the 15% statutory requirement.