Global ratings agency AM Best has signalled confidence in WAICA Reinsurance Corporation, upgrading its outlook to positive from stable while affirming its Financial Strength Rating (FSR) at B (Fair) and Long-Term Issuer Credit Rating (ICR) at bb+ (Fair).

The Sierra Leone based reinsurer, with operations spanning over 90 countries, is expected to deliver sustained robust earnings driven by strong underwriting discipline and effective claims management in the African reinsurance market, the agency indicated in a report.

It highlighted WAICA Re’s superior ROE, outpacing benchmark interest rates and demonstrating a durable earnings engine despite a low-yield environment. The reinsurer’s balance sheet strength, supported by organic growth and improved asset quality, further bolsters the positive outlook, sustaining the strongest level of risk-adjusted capitalisation.

WAICA Re’s diversified footprint across Africa offers growth opportunities, with effective risk management and scenario planning, as key to sustaining performance.

The ratings upgrade will ease future capital access and keep the cost of capital in check for growth plans for WAICA Re. Their buffer remained at the strongest level at year-end 2024, with the survival of strong risk-adjusted capitalisation aided by organic growth and asset quality improvements. This capital strength underpins the positive outlook.

The reinsurer’s broad geographic reach supports revenue diversification, but AM Best notes exposure to macroeconomic and political risk given substantial assets in Sub-Saharan Africa. Nonetheless, the firm’s underwriting discipline mitigates some of these risks.

AM Best’s affirmation of WAICA Re’s FSR and ICR, paired with a positive outlook, reinforces the reinsurer’s standing as a disciplined, structurally sound player in a challenging market. With WAICA Re’s combination of strong technical underwriting, improving balance sheet quality, and a diversified global footprint positions it to deliver durable earnings in a low-yield environment.

The positive outlook strengthens WAICA Re’s credibility with potential investors and risk-takers, while also reinforcing the reinsurer’s reliability for policyholders and brokers, potentially translating into more competitive pricing and broader market access.