AM Best, the credit rating agency, has adjusted its outlook on Conduit Reinsurance Limited (Conduit Re) from positive to stable.
According to AM Best, the reaffirmed ratings are supported by Conduit Re’s very strong balance sheet, consistent operating results, focused business model, and well-structured risk management framework.
The revised stable outlook indicates that AM Best expects Conduit Re to maintain the key qualities underpinning its current ratings in the near to mid-term, especially as the company strengthens its position under a refreshed senior leadership team.
AM Best’s assessment of Conduit Re’s balance sheet is anchored by risk-adjusted capital expected to remain at the highest tier under Best’s Capital Adequacy Ratio (BCAR). The company benefits from high-quality capital with no debt, a cautious investment mix centred on fixed-income assets, and a reinsurance programme backed by strong counterparties.
Operating performance is viewed as adequate, with expectations for steady underwriting gains supported by sensible pricing and low expenses. While the company still anticipates profitable results for 2025, its significant exposure to the California wildfires has narrowed underwriting results. Conduit Re strengthened its protection strategy during the year through an updated retrocession structure, enhancing its resilience to future secondary peril losses.
Conduit Holdings Limited, the parent company, recorded a minor loss of USD 13.5 million for the first half of 2025, compared with a profit of USD 98.1 million during the same period in 2024.
Since writing its first policies in 2021, Conduit Re has gained strong traction among brokers and cedants, developing a balanced portfolio across various lines and regions. AM Best expects the reinsurer to produce about USD 900 million in reinsurance revenue in 2025. Although several senior leadership roles changed during the year, replacements have been carefully selected and bring strong professional experience to the organisation.
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