Ratings firm AM Best has affirmed the financial strength rating of A++ (Superior) and issuer credit rating of “aa+” of Bermuda-based Tokio Millennium Re (TMR).The outlook for both ratings is stable.TMR is a wholly owned subsidiary of Tokio Marine & Nichido Fire Insurance Co (TMNF), which is the main trading subsidiary of Tokio Marine Holdings, Inc. Both companies are domiciled in Tokyo, Japan.The ratings reflect TMR’s superior financial strength, favourable operating performance over the last several years and its prudent risk management practices. In addition, the ratings are enhanced by the implicit and explicit support provided by TMNF. The ratings also consider TMR’s strategic importance to Tokio Marine Group’s initiatives to geographically diversify its catastrophe risks as well as enhance its enterprise risk management function.“Tokio Marine Group has unified its global reinsurance brand under TMR over the past few years,” AM Best said in a statement. “TMR benefits from the global recognition and balance sheet strength of TMNF. TMR predominately writes property catastrophe and specialty reinsurance and has been slowly expanding into casualty reinsurance since mid-2011 to diversify its book of business. TMR continues to be a leader in transforming and transferring reinsurance risk to the capital markets, through its new entities Shima Re and Tokio Solution Management.”AM Best adds that partially offsetting the positive rating factors is TMR’s exposure to low frequency, high severity catastrophic events, as evidenced by the New Zealand earthquakes. “These losses significantly impacted TMR’s financial performance in 2011; however, the company remains well capitalised and well positioned to take advantage of improving property catastrophe rates in the global marketplace,” said AM Best.