AM Best Withdraws Credit Ratings for NEWGT Reinsurance Company, Ltd.
AM Best has affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) of NEWGT Reinsurance Company, Ltd. (NEWGT), a Bermuda-based reinsurance company. The ratings were affirmed with a stable outlook before being withdrawn at the company’s request, as NEWGT has decided to no longer participate in AM Best’s interactive rating process.
The rating action comes as NEWGT moves toward the final stage of its existing business strategy, which involves transferring its remaining insurance policies and subsequently winding down operations. The company’s latest business plan calls for its remaining policies to be fully novated to GUNA Re, a reinsurance entity established in the Cayman Islands that AM Best views as NEWGT’s re-domiciled entity.
Although the ratings have been withdrawn, AM Best’s assessment prior to the withdrawal reflected NEWGT’s very strong balance sheet strength, adequate operating performance, very limited business profile and appropriate enterprise risk management. The assessment also incorporated the financial and operational support provided by NEWGT’s parent company, ITOCHU Corporation (ITOCHU).
AM Best expects that parental support from ITOCHU will continue throughout the transfer of NEWGT’s remaining business and the company’s subsequent winding-down process.
Ratings Affirmed Before Withdrawal
The sequence of the rating action is important. AM Best first affirmed NEWGT’s FSR of A- (Excellent) and Long-Term ICR of “a-” (Excellent), maintaining a stable outlook. The ratings were then withdrawn because NEWGT requested to discontinue its participation in AM Best’s interactive rating process.
The withdrawal therefore should not be interpreted as a deterioration in NEWGT’s financial strength based on the information provided by AM Best. Instead, it reflects the company’s decision not to continue participating in the rating process.
AM Best’s final assessment before withdrawal continued to recognize NEWGT’s strong capitalization and the support available to the company as it transitions its remaining business.
The distinction is particularly relevant because NEWGT is already pursuing a wind-down strategy. With most of its underwriting portfolio transferred and its remaining policies expected to move to GUNA Re in the near term, the company’s business profile has become substantially smaller than it was previously.
Strategic Wind-Down and Business Transfer
A major factor in AM Best’s assessment is NEWGT’s plan to wind down its operations after completing the transfer of its remaining policies.
The remaining business is expected to be fully novated to GUNA Re, which AM Best considers to be NEWGT’s re-domiciled entity established in the Cayman Islands. GUNA Re has a largely identical shareholding structure, management team and business objectives to NEWGT.
The planned transfer represents a significant stage in the restructuring of the company’s operations. Rather than continuing to build a new underwriting portfolio in Bermuda, NEWGT is expected to complete the transfer of its outstanding business and proceed with an orderly wind-down.
The reduced scale of the company’s business has been reflected in AM Best’s assessment of its business profile. With much of the underwriting portfolio already transferred, NEWGT now has a materially smaller operating footprint.
The transition is expected to continue in the near term, with management focused on transferring the remaining policies and ensuring that the company can complete its wind-down in an orderly manner.
Very Strong Balance Sheet Strength
Despite the significant reduction in its business scale, NEWGT’s balance sheet strength remained a major positive factor in AM Best’s assessment.
AM Best assesses the company’s balance sheet strength as very strong, supported in particular by a material improvement in its risk-adjusted capitalization.
The improvement was measured as of June 2026 using AM Best’s Best’s Capital Adequacy Ratio (BCAR). The company’s risk-adjusted capitalization benefited from lower underwriting and credit risks following the transfer of most of its underwriting portfolio.
The reduction in underwriting exposure is particularly important for a reinsurance company because capital requirements are closely linked to the risks associated with its insurance portfolio. As NEWGT transferred a substantial portion of its policies, the company’s exposure to underwriting risk declined accordingly.
Similarly, the transfer reduced certain credit-related risks associated with the company’s previous business activities.
AM Best expects NEWGT to maintain a good capital buffer while it manages its remaining business. The remaining portfolio is expected to be transferred to GUNA Re in the near term, further reducing the company’s ongoing underwriting exposure.
Conservative Investment Portfolio
NEWGT’s investment portfolio also contributes to the company’s financial position during the wind-down process.
The company’s investments consist primarily of cash and term deposits, including term deposit agreements with its group company, ITOCHU Treasury.
The composition of the investment portfolio provides NEWGT with a relatively straightforward asset structure as it prepares to complete the transfer of its remaining insurance obligations.
AM Best considers the liquidity and credit risks associated with these term deposits to be low in the coming years. This assessment reflects both the terms and conditions of NEWGT’s existing term deposit agreements and the credit profile of ITOCHU Treasury.
Maintaining liquid and relatively low-risk assets is particularly important for a company approaching a wind-down phase. The availability of cash and term deposits can provide financial flexibility as NEWGT settles obligations, completes policy transfers and manages the remaining expenses associated with its operations.
The company’s investment strategy therefore supports its ability to meet its remaining financial obligations while progressing toward the planned completion of its business transition.
Historical Operating Performance
NEWGT has also demonstrated a track record of positive operating results.
According to AM Best, the company reported consistently positive results over the five-year period from fiscal year 2020 through fiscal year 2024.
This historical performance provides support for AM Best’s assessment of NEWGT’s operating performance as adequate.
However, the company’s operating metrics are expected to change as the remaining business is transferred and NEWGT moves through its winding-down period.
Because the company is no longer operating at its previous underwriting scale, certain key underwriting performance indicators are expected to come under pressure during the transition. The reduction in premium volume and the changing composition of the remaining portfolio can affect the company’s underwriting metrics.
AM Best expects investment returns to partially offset this pressure, supporting the current assessment of adequate operating performance.
The combination of historically positive results, a reduced underwriting portfolio and investment income provides the financial backdrop for the company’s remaining operations.
Business Profile Becomes More Limited
NEWGT’s business profile is assessed as very limited, reflecting the substantial reduction in the company’s business scale and its decision to wind down in the near term.
A company’s business profile is an important element of AM Best’s overall rating methodology because it considers factors such as market position, diversification, operating scale and competitive characteristics.
For NEWGT, the business profile has changed materially as a result of the transfer of most of its underwriting portfolio.
With a smaller remaining portfolio and a planned wind-down, NEWGT is no longer positioned as a growing, standalone underwriting operation. Instead, its primary focus is now on managing the remaining business, completing the novation of outstanding policies and preparing for the eventual conclusion of its operations.
The planned transfer to GUNA Re is therefore central to the company’s current strategic direction.
Role of ITOCHU Corporation
Parental support from ITOCHU Corporation is another factor incorporated into AM Best’s assessment of NEWGT.
ITOCHU, as NEWGT’s parent company, has provided support to the reinsurance operation, and AM Best expects that support to continue throughout the transfer of the remaining business and the winding-down process.
Parental support can be particularly important during a corporate transition because a company may face expenses and operational requirements even as its revenue-generating activities decline.
For NEWGT, continued support from ITOCHU is expected to provide an additional layer of financial and operational stability while the company completes its remaining obligations.
The relationship between NEWGT and GUNA Re also provides continuity during the restructuring process. With GUNA Re maintaining a largely identical shareholding structure, management team and business objectives, the transition is expected to preserve significant organizational continuity.
Enterprise Risk Management
AM Best assesses NEWGT’s enterprise risk management as appropriate.
Effective risk management remains important even when an insurance company is reducing its business activities. During a wind-down, management must continue to monitor outstanding insurance liabilities, investment exposures, liquidity requirements and operational risks.
The transfer of policies to GUNA Re also requires careful coordination to ensure that remaining obligations are appropriately managed.
NEWGT’s risk management framework is considered appropriate for the company’s current risk profile and business objectives. As the company’s underwriting exposure has declined, its risk profile has become more closely associated with managing its remaining portfolio and executing the planned wind-down.
What the Rating Withdrawal Means
The withdrawal of NEWGT’s ratings follows the company’s request to no longer participate in AM Best’s interactive rating process.
It is therefore important to distinguish the withdrawal from a rating downgrade. AM Best had affirmed the company’s ratings at A- (Excellent) and “a-” (Excellent), with a stable outlook, immediately before withdrawing them.
The action reflects NEWGT’s decision regarding participation in the rating process rather than a stated deterioration in its balance sheet strength.
The withdrawal also occurs against the backdrop of NEWGT’s planned business wind-down and transfer of its remaining policies to GUNA Re.
NEWGT’s immediate priorities are expected to center on completing the transfer of its remaining insurance policies, maintaining adequate capitalization, managing its investment assets and fulfilling its outstanding obligations during the wind-down period.
The company’s very strong balance sheet strength, improved risk-adjusted capitalization and liquid investment portfolio provide a solid foundation for completing the transition.
The planned novation of the remaining policies to GUNA Re is expected to significantly reduce NEWGT’s ongoing underwriting exposure. Once the transfer is completed, the company can continue progressing toward its planned wind-down.
ITOCHU’s continued support is also expected to remain an important component of the transition, particularly as NEWGT manages the final stages of its operations.
Overall, AM Best’s assessment prior to the withdrawal indicated that NEWGT remained financially sound, with an A- (Excellent) Financial Strength Rating and an “a-” (Excellent) Long-Term Issuer Credit Rating. The stable outlook reflected expectations that the company would maintain an appropriate financial position while completing its remaining business transfer.
The subsequent withdrawal was made at NEWGT’s request because the company chose to discontinue its participation in AM Best’s interactive rating process.
As NEWGT moves toward the completion of its strategic wind-down, the company’s focus will remain on responsible management of its remaining portfolio, maintaining financial resources, completing policy novations and ensuring an orderly transition to GUNA Re. The combination of improved capitalization, low-risk investments, historical positive operating results and parental support from ITOCHU provides important financial backing for the company’s remaining activities.
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