AM Best has affirmed the financial strength and issuer credit ratings of Bermudian-based BNY Trade Insurance Ltd and New York-based The Hamilton Insurance Corp, maintaining stable outlooks for both companies.

The ratings agency affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” (Excellent) for both insurers.

BNY Trade Insurance and Hamilton operate as single-parent captive insurers for The Bank of New York Mellon Corp, providing reinsurance coverage and related insurance products to the global financial services group.

BNY Trade Insurance had a balance sheet strength assessment of “strongest”, while Hamilton Insurance Corp, based in Melville, New York, had a “very strong” assessment.

AM Best said BNY Trade's balance sheet strength showed risk-adjusted capitalisation at the strongest level, as measured by Best's Capital Adequacy Ratio, alongside excellent liquidity and consistent annual profits over the past five years driven by organic growth.

Hamilton's assessment was supported by strong capitalisation and above-average liquidity.

The ratings agency said both companies also benefit from the financial flexibility and support of their ultimate parent, The Bank of New York Mellon Corp.

AM Best said the insurers' operating performance was strong, with excellent combined ratios and loss history and a low expense structure.

According to AM Best, the captive insurers are an important part of the parent company's overall risk management framework and are covered by company policy on corporate governance, compliance, ethics and resilience.

The ratings agency also said enterprise risk management at both companies was appropriate.