KBRA Affirms Rating on Helios Underwriting plc's Notes

KBRA affirms the long-term credit rating of A- on Helios Underwriting plc’s (Helios) USD 75 million 9.5% fixed rate Series A Senior Unsecured Notes due December 15, 2030. The Outlook for the rating is Stable.

Key Credit Considerations

The rating reflects Helios’ manageable financial leverage, strong debt service coverage, experienced management team, consistent profitability on its Lloyd’s portfolio, and access to multiple sources of capital to support its business plan. Balancing these strengths are exposure to catastrophe and key person risks. In addition, KBRA believes that Helios possesses some unique strategic competitive advantages as a provider of private capital to the Lloyd’s market and as a provider of uncorrelated insurance-linked securities to investors.

Underpinning KBRA’s assessment of Helios’ Notes is KBRA’s view that Lloyd’s of London (AA-/Stable) is a single, indivisible market. As a member of the Lloyd’s market, Helios is entitled to all the benefits of membership, but also must fully comply with all the requirements imposed on members by the Council.

Rating Sensitivities

Strong internal generation of capital or a reduction in financial leverage faster than planned could result in a positive rating action. Unfavorable underwriting experience on deployed capacity, elevated financial leverage, breach of a covenant in the Notes agreement, or the loss of a key member of the management team or Board without a suitable replacement could result in a negative rating action.

To access ratings and relevant documents, click here.

Methodologies