AM Best Affirms Credit Ratings of Blue Whale Re Ltd.
AM Best has affirmed the Financial Strength Rating of A
(Excellent) and the Long-Term Issuer Credit Rating of “a+”
(Excellent) of Blue Whale Re Ltd. (Blue Whale) (Burlington, VT).
The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Blue Whale’s balance sheet strength, which
AM Best assesses as very strong, as well as its strong operating
performance, neutral business profile and appropriate enterprise
risk management (ERM).
The ratings also reflect Blue Whale’s strategic position as the
captive insurer for Pfizer Inc. (Pfizer) [NYSE: PFE], a leading
global pharmaceutical company. As Blue Whale insures or reinsures
Pfizer’s global property exposures, it plays an important role in
Pfizer’s overall ERM and assumes a critical role in protecting the
Pfizer enterprise’s assets.
The stable outlooks reflect AM Best’s view that the company’s
operations will continue to generate operating results that
engender supportive capitalization for the ratings.
Blue Whale’s capitalization is very strong, albeit reliant on
its parent. It operates at conservative underwriting leverage
levels; however, it provides coverages with extremely large limits,
and its gross exposures per loss occurrence are elevated. Although
Blue Whale benefits from reinsurance protection, it is heavily
dependent on reinsurance, with very substantial net retentions. Its
reinsurance is provided by a large panel of reinsurers that provide
significant capacity. AM Best takes into consideration the quality
of the reinsurers, and the substantial financial resources and
support available to the captive as part of the Pfizer
Blue Whale’s operating results continue to be strong, digesting
infrequent substantial losses in line with its mission. The company
has adjusted premium for hard market conditions offset by the
company’s decreasing property insurance requirements following
Pfizer’s divestiture of Upjohn Inc., including the Caribbean
production and warehouse facilities.
Due to the nature of the relationship between Blue Whale and
Pfizer, changes in AM Best’s perception of Pfizer’s ability and/or
willingness to support Blue Whale can impact Blue Whale’s ratings.
Pfizer’s market-based credit risk measures indicate general
strength and take into account the company’s strategic shift toward
newer pharmaceuticals, with Pfizer having completed divestiture of
its over-the-counter pharmaceutical business and contribution of
its mature pharmaceuticals going off patent to a joint venture.
Since the emergence of COVID-19, Pfizer also has increased usage of
Blue Whale by adding incremental product liability coverage
(normally wholly retained by the parent) for a portion of its
vaccine-related products distributed in several developing
countries as a ‘belt and suspenders’ precaution beyond its required
sovereign indemnifications. Based on the parent’s corporate
strategy, and Blue Whale’s current reinsurance program, Blue Whale
appears well-positioned to continue to address Pfizer’s insurance
AM Best remains the leading rating agency of alternative risk
transfer entities, with more than 200 such vehicles rated in the
United States and throughout the world. For current Best’s Credit
Ratings and independent data on the captive and alternative risk
transfer insurance market, please visit
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 use of Best’s
Credit Ratings, Best’s Performance Assessments, Best’s Preliminary
Credit Assessments and AM Best press releases, please view Guide to
Proper Use of Best’s Ratings & Assessments.
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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 London, Amsterdam,
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