Black Gold Re, the Bermudian-based captive reinsurer of Colombian state energy company Ecopetrol, has had its financial strength rating upgraded to A- (excellent) from B++ (good) by AM Best.

The credit ratings agency also upgraded BGRe’s long-term issuer credit rating to a- (excellent) from bbb+ revised its outlook to stable from positive.

AM Best said the ratings reflected BGRe’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

The upgrading of these ratings also reflects BGRe’s consistently robust balance sheet fundamentals, supported by strong internal capital generation and a sustained trend of risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio.

This position is supported by a comfortable buffer and is expected to be sustained over the medium term. The company’s balance sheet strength is further reinforced by efficient capital management practices, a conservative asset-liability management framework and low underwriting leverage.

BGRe made an initial dividend payment in 2025 to its parent company and anticipates future distributions. However, they are expected to be aligned with the BGRe’s capital management approach and not to materially weaken the company’s balance sheet strength.

Ecopetrol is an integrated energy company that is 88.5 per cent owned by Colombia’s government. BGRe’s ratings recognise the importance of the company within Ecopetrol’s strategy.

Through a dual insurance programme structure, BGRe provides reinsurance to the Ecopetrol group, focusing on specialised property-and-casualty lines while maintaining a prudent risk retention profile.

The company continues to demonstrate a solid track record of profitable underwriting performance, as evidenced by sustained low combined ratios.

BGRe’s performance reflects disciplined loss ratio management, underpinned by a robust retrocession programme, effective expense management and stable ceding commission income. AM Best expects BGRe to maintain premium sufficiency, supported by disciplined underwriting.

AM Best views the company’s business profile as neutral. BGRe benefits from access to a wide scope of insured risks, reflecting Ecopetrol’s relevance within the oil and gas industry in the Americas.