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AM Best Affirms Credit Ratings of Top Layer Reinsurance Ltd.

June 23, 2021 GMT

OLDWICK, N.J.--(BUSINESS WIRE)--Jun 23, 2021--

AM Best has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “aa-” (Superior) of Top Layer Reinsurance Ltd. (Top Layer) (Bermuda). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Top Layer’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, neutral business profile and very strong enterprise risk management.

These ratings continue to reflect the substantial amount of support Top Layer receives from its co-owners, State Farm Mutual Automobile Insurance Company (State Farm) (currently with an FSR of A++ [Superior] and a Long-Term ICR of “aa+” [Superior]) and Renaissance Reinsurance Ltd. (RenaissanceRe) (currently with an FSR of A+ [Superior] and a Long-Term ICR of “aa-” [Superior]).


The ratings also reflect the significant parental support from State Farm, which provides Top Layer with implicit and explicit support as needed. In turn, Top Layer provides State Farm with exposure to non-U.S. high layer reinsurance risk, which is uncorrelated to its own core business.

The company’s capital profile is very unique from a qualitative and quantitative perspective, but fundamentally, Top Layer offers clients credit security in the layers of a reinsurance program in which this element is paramount. Top Layer’s capitalization is enhanced through various contractual obligations, resulting in substantial capital support and reinsurance protection from State Farm, and, to a much lesser degree, RenaissanceRe. The occurrence of large losses will trigger capital calls for State Farm and RenaissanceRe to replenish Top Layer’s capital. Moreover, State Farm provides Top Layer with $3.9 billion excess of $100 million stop-loss reinsurance protection. This coverage is significantly larger than the aggregate exposures Top Layer undertakes in each of its geographic zones.

Since Top Layer’s inception in 1999, it has generated solid operating and has suffered only two losses (i.e., 2010 and 2011) in its 21-year operating history. AM Best attributes this favorable result to the property catastrophe underwriting expertise of RenaissanceRe, and the fact that there are very few catastrophes of a magnitude sufficient to impact the programs written in Top Layer’s areas of focus, which are high excess layers of non-U.S. property catastrophe risks. Top Layer maintains a modest amount of on-balance sheet capital relative to the high excess layers of property catastrophe risks it assumes.

AM Best acknowledges that Top Layer’s ratings are largely dependent upon the support it receives from State Farm and RenaissanceRe. AM Best monitors these companies on an ongoing basis and continues to assess how any developments may impact Top Layer’s ratings.


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 media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global credit rating agency, news publisher and 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, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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CONTACT: Gregory Dickerson

Associate Director

+1 908 439 2200, ext. 5161

gregory.dickerson@ambest.comSteven Chirico


+1 908 439 2200, ext. 5087

steven.chirico@ambest.comChristopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.comJim Peavy

Director, Communications

+1 908 439 2200, ext. 5644





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PUB: 06/23/2021 12:05 PM/DISC: 06/23/2021 12:05 PM