AM Best has affirmed the financial strength rating of A (Excellent) and the long-term issuer credit rating of “a” (Excellent) of Inpex Insurance (Bermuda). The outlook of these credit ratings is stable.

IIL is a single-parent captive of Inpex, the largest oil and gas exploration and production company in Japan.

It underwrites energy-related operational and construction risks with coverage that mainly encompasses property damage, third-party liability and operator’s extra expenses for its parent group.

The agency said the ratings reflected the Bermuda-domiciled company’s balance sheet strength, which it assessed as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

“IIL’s risk-adjusted capitalisation is assessed at the strongest level, as measured by Best’s capital adequacy ratio,” AM Best said. “The company’s balance sheet strength is supported by its low net underwriting leverage and a highly conservative and liquid investment portfolio.”

AM Best added that despite IIL’s distribution plan of accumulated surplus to the parent company, Inpex Corporation, IIL is expected to maintain a sufficient capital buffer to support its book of business.

“IIL has relatively high reinsurance dependence; however, its credit risks are partially mitigated by the good credit quality of its reinsurance panel,” AM Best said. “The company also secures stable reinsurance capacity from Everen, an energy sector-dedicated mutual insurance company.”

A credit ratings spokesman said the firm’s operating performance assessment reflected its strong underwriting results with an adjusted five-year average combined ratio of below 30 per cent (2021-2025) excluding the accrual of theoretical withdrawal premium, as calculated by AM Best.

“Although IIL’s accrual of theoretical withdrawal premium for the membership of Everen will likely add some pressures on the bottom line, AM Best expects IIL to deliver a strong underwriting performance with a prudent approach in underwriting and retention over the medium term.”

IIL’s top line revenue remained stable in 2025, but various new projects by Inpex are expected to generate additional premium income within a few years, while its investment income is expected to remain strong over the medium term, due to a favourable interest rate environment.