AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Jacana Re Limited, the Guernsey-based subsidiary of BHL Holdings Limited. The outlook on both ratings remains stable. For insurance and reinsurance decision-makers, the affirmation is a signal that the company’s capital position, underwriting track record, and role within the wider group continue to support its current rating level.
What AM Best said
AM Best said the ratings reflect Jacana Re’s very strong balance sheet strength, strong operating performance, limited business profile and appropriate enterprise risk management. The agency also gave lift to the ratings for Jacana Re’s strategic importance to BHL, where it serves as the group’s internal reinsurer.
The affirmation is therefore not just a statement about one company’s standalone profile. It also reflects how Jacana Re fits into BHL’s broader risk-management structure.
Capital strength and liquidity
A key part of the assessment is Jacana Re’s risk-adjusted capitalisation, which AM Best expects to remain comfortably at the strongest level under Best’s Capital Adequacy Ratio. The company’s conservative investment portfolio and excellent liquidity also support the balance sheet view.
AM Best noted an offsetting factor: exposure to catastrophe risk, mainly from Australia and South Africa. That concentration matters because reinsurance capital can be pressured quickly when losses emerge from severe weather or other natural peril events.
For institutional readers, the practical issue is not whether catastrophe exposure exists, but how well it is matched by capital, liquidity and underwriting discipline. On that basis, AM Best’s view was that Jacana Re remains well positioned at present.
Underwriting performance and earnings mix
Jacana Re has a record of strong operating performance, supported by consistent underwriting results. In financial year 2025, the company reported a net-net combined ratio of 71.7% and a return on equity of 23.9%, according to AM Best. Those figures were in line with the company’s five-year averages.
AM Best also said investment income makes only a modest contribution to earnings. That leaves underwriting performance as the main driver of profitability, which increases the importance of pricing discipline and claims experience.
The agency expects underwriting profits to reduce in FY2026 following catastrophe losses in Australia. That guidance is cautious rather than alarmist, but it highlights a familiar reinsurance reality: even strong historical performance can move meaningfully when natural catastrophe losses spike.
Group role and business concentration
Jacana Re’s business model is closely tied to BHL. AM Best said the entity is used by BHL as a risk-management tool, retaining 100% of risks ceded by insurance companies of the BHL group and its ultimate shareholders. The risks underwritten by Jacana Re stem from South Africa, Australia and Singapore.
That structure has clear operational benefits. It centralizes risk retention, supports internal capital management and creates a dedicated vehicle for the group’s insurance exposures. But it also limits diversification. AM Best said Jacana Re’s business profile is constrained by geographic concentration of premium volume and by the lines of business it underwrites.
For boards, CFOs and risk committees, the question is whether that concentration remains consistent with the group’s tolerance for volatility and catastrophe sensitivity.
Key Takeaways
- AM Best affirmed Jacana Re Limited’s Financial Strength Rating of A (Excellent) and Long-Term Issuer Credit Rating of “a” (Excellent), both with stable outlooks.
- AM Best highlighted very strong capitalisation, conservative investments and excellent liquidity, while noting exposure to catastrophe risk from Australia and South Africa.
- Jacana Re reported a FY2025 net-net combined ratio of 71.7% and return on equity of 23.9%, and AM Best expects FY2026 underwriting profits to ease after catastrophe losses in Australia.
FinanceInsyte's Take
The affirmation suggests Jacana Re’s current credit profile remains supported by capital strength, underwriting discipline and its strategic role within BHL’s group structure. For readers focused on insurance infrastructure and balance-sheet resilience, the key watch items are catastrophe loss development, future underwriting volatility and whether the company’s concentrated risk profile continues to be offset by earnings and capital adequacy.
Source: Businesswire
