AM Best Affirms Credit Ratings of SIAT-Società Italiana Assicurazioni e Riassicurazioni p.A.

AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of "a-" (Excellent) of SIAT-Società Italiana Assicurazioni e Riassicurazioni p.A. (SIAT) (Italy), a subsidiary of UnipolSai Assicurazioni S.p.A. (UnipolSai). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect SIAT's balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The ratings also consider, in the form of rating lift, AM Best's expectation that UnipolSai will provide financial support to SIAT if needed.

SIAT's risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio (BCAR), was at the strongest level at year-end 2020 and AM Best expects the BCAR to be maintained at least at the very strong level.

The company maintains a strong liquidity profile, with liquid investments accounting for approximately 126% of its year-end 2020 net technical liabilities. Offsetting factors in the balance sheet strength assessment include the company's investment concentration in Italian government bonds and its dependence on reinsurance to write high-value risks.

SIAT has a track record of adequate underwriting performance with volatility contained by an effective reinsurance programme. In 2020, pre-tax profits increased to EUR 5.9 million from EUR 1.1 million in 2019 (adjusted by AM Best for extraordinary income and expenses), due an improvement in SIAT's underwriting performance, particularly in its hull line of business. AM Best expects SIAT to achieve a return-on-equity ratio in the high single digits in 2021, supported by selective underwriting and further pricing improvements for marine insurance lines.

SIAT has an established reputation as a niche insurer in the marine hull and cargo segments, in which it ranks among the leading players in Italy. In addition, the company's business profile is strengthened by its reciprocal outsourcing agreements with UnipolSai, a large Italian insurer. SIAT benefits from a developed ERM framework, with the risk function centralised at the group level.

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 Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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