Tuesday, April 24, 2018

A.M. Best concerned about insurance co-op’s exposure to Puerto Rican bonds

By on April 5, 2018

SAN JUAN – Insurance rater A.M. Best issued a release announcing it has placed San Juan-based Cooperativa de Seguros de Vida de Puerto Rico’s (Cosvi) Financial Strength Rating of C+ (Marginal) and Long-Term Issuer Credit Rating of “b-” under review, with negative implications.

A.M. Best said the new rating status is a result of its concern about the cooperative’s exposure to Puerto Rico bonds and the “volatility this represents to Cosvi’s capital and surplus.”

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The credit rating company expects a “potential decline in either absolute or risk-adjusted capital at year-end 2017” to be reflected in Cosvi’s annual statement. However, A.M. Best said it will wait for the statement and discuss the results with Cosvi management before making any revision.

Cosvi has been operating on the island for nearly 60 years and also serves non-cooperative market sectors on the island via several regional offices. Besides life and disability insurance, it also provides retirement plan services.

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