AM Best Affirms Credit Ratings of Royal Bank of Canada Insurance Company Ltd.

AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” (Excellent) of Royal Bank of Canada Insurance Company Ltd. (RBCICL) (Cayman Islands). The outlook of these Credit Ratings (ratings) is stable.

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

RBCICL is a profitable subsidiary of Royal Bank of Canada (RBC), which is the largest bank in Canada as measured by market capitalization. RBCICL has high brand recognition as it executes its strategy of reinsuring and managing Canadian Creditor Life, Longevity and other international insurance products, which aligns with the company’s strategy. The company holds a contractual service margin (CSM) liability for its profitable reinsurance contracts that uses the general measurement model under IFRS17. This CSM contributed to a decline in reported capital on transition to IFRS 17 (transitioned to IFRS17 effective November 1, 2023) but is expected to be released into earnings over time. The company reported a total net income of CAD 707.8 million, driven by a strong insurance service result of CAD 700.8 million.

The parent bank is a strong organization with approximately CAD 139 billion of IFRS equity at financial year-end 2025 and over CAD 2.3 trillion in assets. RBC group earned approximately CAD 20.4 billion in net income on CAD 66.75 billion in revenue in fiscal year 2025. AM Best notes that RBC does not guarantee support but may provide additional capital at its discretion should RBCICL need to maintain its risk-adjusted capitalization levels.

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 use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

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 www.ambest.com.

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