Financial services

Ethio Re Affirmed with Stable Outlook by AM Best

Strategic Insights

Sep 16, 2025 — 1 min read

Ethio Re, a small reinsurance company in Ethiopia, has been affirmed with a stable outlook by A.M. Best Company, Inc. The company's strong balance sheet and adequate operating performance have been highlighted by A.M. Best, despite its limited business profile and marginal enterprise risk management. Ethio Re's risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio (BCAR), has been comfortably at the strongest level at fiscal year-end June 2024. The company has also maintained healthy capital buffers in excess of the strongest threshold as it continues to execute its strategic growth plans.

Key Takeaways:

Ethio Re's Financial Strength Rating has been affirmed by A.M. Best Company, Inc., with a stable outlook.
The company's balance sheet strength is underpinned by its risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio (BCAR), which was comfortably at the strongest level at fiscal year-end June 2024.
Ethio Re has a track record of adequate operating performance, generating a return on equity ratio (ROE) of 17.1% for year-end June 2024.
The company has a small base by global standards, with insurance service revenue of USD 38 million at fiscal year-end June 2024.
Ethio Re benefits from privileged market access in Ethiopia, where over 95% of its revenue is generated.
The company has a conservative investment portfolio by asset class, which is weighted towards cash and deposits, limiting its exposure to market risks and the ongoing restructuring of Ethiopian sovereign bonds.

Statistics:

Ethio Re's Best's Capital Adequacy Ratio (BCAR) was at the strongest level at fiscal year-end June 2024.
The company generated a return on equity ratio (ROE) of 17.1% for year-end June 2024.
Ethio Re has insurance service revenue of USD 38 million at fiscal year-end June 2024.
The company's net/net combined ratio was 96.4% in 2024.
Ethiopia's National Bank Rate has stood at 15% since August 2024.

Sources:

A.M. Best Company, Inc.
Best's Capital Adequacy Ratio (BCAR)
Guide to Best's Credit Ratings
Guide to Proper Use of Best's Ratings & Assessments

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