Wednesday, July 24, 2024

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AM Best affirms rating of JP Morgan captive

AM Best has affirmed the financial strength rating of A (excellent) and the long-term issuer credit Rating of “a” (excellent) of Vermont-domiciled Park Assurance Company. The outlook for the ratings is stable.

Park is a single parent captive owned by JPMorgan Chase Holdings, a subsidiary of JPMorgan Chase & Co.

The captive provides JPMorgan with global property coverages, including terrorism, cyber and banker’s blanket bond.

These coverages are important components of JPMorgan Chase’s risk management strategy and the captive benefits from the support of the group’s significant resources.

AM Best considers Park’s business profile to be limited due to its product concentration risk, offering limited lines of coverage on a net basis.

Partially offsetting these factors is the credit risk associated with Park’s extensive use of reinsurance, which mitigates its exposure to oversized losses on substantially valued insured locations, as well as its reliance on the protection from the Terrorism Risk Insurance Program Reauthorization Act (TRIA).

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

Park’s strongest level of risk-adjusted capitalisation, as measured by AM Best’s capital adequacy ratio (BCAR), reflects its conservative loss reserving practices and favourable development trends, along with its conservative investment portfolio and strong liquidity measures.