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HDFC International Life and Re, a wholly-owned subsidiary of HDFC Life Insurance, has been assigned a long-term insurer financial strength rating of 'BBB' with a stable outlook by S&P Global.
The company is the first full life reinsurer to start operations out of Dubai International Finance Centre (DIFC) and is regulated by the Dubai Financial Services Authority (DFSA).
Its business consists of both treaty and facultative reinsurance arrangements assumed from ceding companies in the Gulf Cooperation Council (GCC) region, relating to a broad range of life insurance product lines covering individual life, group life and group credit life.
"The rating reflects our assessment of the company as a startup reinsurer, albeit one operating in the relatively low-risk life reinsurance space, supported by extremely strong capital adequacy and abundant liquidity," S&P Global said in a statement.
S&P Global also added that the stable outlook reflects its view that HDFC Life Re will maintain its extremely strong capital adequacy and low risk tolerance.
The reinsurer will gradually increase its premium base in both the United Arab Emirates and the wider Middle East and North Africa region, and start reporting profitable results on a technical as well as on an overall basis, the rating agency said.
Vibha Padalkar, Chairman of the Board of HDFC International Life & Re, and Managing Director & CEO of HDFC Life said that this rating reflects the company's robust capital shield, strong liquidity profile and balanced risk portfolio.
HDFC International Life and Re, with a paid up capital of $29.5 million, was incorporated in Dubai on January 10, 2016 under the Dubai International Finance Centre.
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