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MEXICO CITY–(BUSINESS WIRE)–AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb” of AVLA Perú Compañía de Seguros S.A. (AVLAP) (Lima, Peru). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect AVLAP’s balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

AVLAP is a Peru-based property/casualty insurer that began operations in 2015. It specializes in surety, with complimentary lines of credit insurance and engineering, and ranks eighth among non-life carriers in Peru and second in the country’s surety segment based on market share.

AM Best views AVLAP’s business profile as neutral. Since its creation in 2015, AVLAP has capitalized successfully on Peru’s guarantee market, which has limited capacity, and become one of the country’s main participants for credit insurance and surety. During 2020, the company continued expanding its business despite the COVID-19 pandemic, but current developments related to the recovery and reactivation of Peru’s economy still leaves room for execution risk. AM Best’s neutral assessment of the company’s business profile is hindered by the small size of its operation within a small segment in Peru, which currently is in Country Risk Tier 3, per AM Best’s country risk evaluation.

AM Best considers the company’s operating performance to be adequate despite its recent creation. AVLAP has been able to promote its products in a profitable manner and maintain adequate underwriting performance since 2017 and into a complicated 2020; however, the operation remains small and needs to converge to an adequate and less volatile cost structure, for which adjustments are taking place at a group level. Operating performance has been complemented by an active investment strategy that generated good investment results in 2020.

AVLAP’s balance sheet assessment is very strong given its solid capital base for the risks it undertakes, as reflected in its strongest risk-adjusted capitalization. The very strong assessment also recognizes the willingness and proven history of capital contributions made by its shareholders to support AVLAP’s growth. In 2019, the company capitalized earnings of PEN 8.5 million (approximately USD 2.5 million). In 2020, the company capitalized retained profits of PEN 6.75 million (USD 1.8 million) and has already committed a capitalization for PEN 6.07 million (USD 1.06 million). Balance sheet strength is supported strongly by a panel of reinsurers with excellent security. Limiting the ratings is the potential pressure of the high financial leverage present in its ultimate parent company, AVLA S.A.

The stable outlooks reflect the company’s management capabilities during a complex 2020. Looking forward into 2021, AM Best expects the company to adjust to the market conditions while maintaining a profitable operation with sound capitalization.

Positive rating actions could take place if the financial leverage at the holding company diminishes to a level that is no longer considered a potential strain on the company’s financial flexibility. Negative rating actions could take place if the company fails to achieve its growth objectives profitably while at the same time negatively affecting its risk-adjusted capitalization. Additionally, if there are important capital outflows to its holding company, AVLA S.A., that weaken AVLAP’s risk-adjusted capitalization, the ratings could be downgraded.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media – Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


Elí Sánchez
Associate Director
+52 55 1102 2720, ext. 122
[email protected]

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
[email protected]

Alfonso Novelo
Senior Director, Analytics
+52 55 1102 2720, ext. 107
[email protected]

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
[email protected]

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