A.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of “a+” of Blue Whale Re Ltd. (Blue Whale) (Burlington, VT). The outlook for both ratings is stable.

The ratings reflect Blue Whale`s strong capitalization and conservative operating strategy. The ratings also consider the company`s critical and central role and favorable profile as part of the Pfizer Group, as well as the excellent performance of its operations. Partially offsetting these positive rating factors are Blue Whale`s very large gross and net underwriting exposures to property losses and its dependence on reinsurance.

Blue Whale is a single parent captive of Pfizer Inc. (Pfizer) [NYSE:PFE], a leading global pharmaceutical company. As Blue Whale (re)insures Pfizer`s global property exposures, it plays an important role in Pfizer`s overall enterprise risk management and assumes a critical role in protecting the Pfizer Group`s assets. Thus, Blue Whale benefits from Pfizer Group`s extensive risk management and loss control programs.

Blue Whale operates at conservative underwriting leverage levels; however, it provides coverages with extremely large limits, and its gross exposures per loss occurrence are elevated. Although Blue Whale benefits from reinsurance protection, its net retentions remain very substantial. Reinsurance is provided by a large panel of reinsurers, and Blue Whale relies on significant capacity to be able to support its obligations. As such, it is heavily dependent on reinsurance. Nevertheless, A.M. Best recognizes the quality of the reinsurers and the substantial financial resources and support available to the captive as part of the Pfizer Group.

Positive rating actions could occur if there is a sustainable and long-term improvement in the operating performance and capital strength of Blue Whale and Pfizer. Conversely, negative rating actions could occur as a result of material operational and performance issues at both Blue Whale and Pfizer. Rating pressure would be likely if there were any adverse changes to many of the regulatory standards to which Pfizer adheres. The potential for future acquisitions, the associated integration risks and company profile changes could lead to both positive and/or negative pressure on the ratings, depending on the acquisition details.

A.M. Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

Key insurance criteria reports utilized:

• Alternative Risk Transfer (ART)

• Evaluating Non-Insurance Ultimate Parents

• Risk Management and the Rating Process for Insurance Companies

• The Treatment of Terrorism Risk in the Rating Evaluation

• Understanding BCAR for Property/Casualty Insurers

This press release relates to rating(s) that have been published on A.M. 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 visit A.M. Best’s Ratings & Criteria Center.

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