Barents Reinsurance S.A.
Barents Re is exposed to a variety of risks through the normal course of its business. These risks need to be effectively managed to ensure they do not impact the ability to achieve business objectives. Effective risk management is thus critical to the success of Barents Re.
Barents Re’s objectives in managing risks include:
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Informing management decision making, improving transparency and accountability for risk though the organization through detailed risk reporting and effective risk governance.
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Identifying opportunities where risk levels can be increased, in line with the risk appetite, to maximize rewards.
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Enabling the quantification of solvency capital required to cover material risks to which the business is exposed to.
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Embedding risk awareness to foster a risk culture across the business.
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Identification of emerging risks such that the business can take appropriate actions to effectively manage these.
To achieve these objectives, Barents Re operates a comprehensive risk management framework and system of internal control. Through these processes, the senior management are informed of the most significant risks exposed to the business on an ongoing basis. Additionally, Barents Re has in place a system of governance which provides a structure for effective risk management. This is referred to as the three lines of defense, and it provides a clearly defined structure and allocation of risk responsibilities across the business functions.
Barents Reinsurance S.A. is regulated by the CAA in Luxembourg, and Barents Reinsurance S.A. (London Branch) is also regulated by the FCA / PRA in the United Kingdom.
Below are the significant risks to which the business is currently exposed. It should be noted that in addition to these, the business is also exposed to emerging risks and uncertainties (i.e., climate change) which could adversely impact the business.
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Insurance risk
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Credit risk
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Market risk
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Liquidity risk
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Operational risk
These risks are assessed through various risk processes which include the ORSA, risk appetite monitoring, stress and scenario testing and risk and control assessments. These processes are reviewed on an ongoing basis to ensure they remain appropriate for the business and risk profile.
Barents Re Reinsurance Company, Inc.
We possess a strong capital position, with PCR coverage consistently exceeding 100% across base and most stress scenarios. The risk profile includes exposures across underwriting, credit, investment, liquidity, operational, cybernetic and emerging risks.
Barents Re maintains a comprehensive Enterprise Risk Management (ERM) framework that ensures alignment with its strategic objectives, regulatory obligations, and capital adequacy standards under the oversight of the Cayman Islands Monetary Authority (CIMA). We possess a strong capital position, with PCR coverage consistently exceeding 100% across base and most stress scenarios. The risk profile includes exposures across underwriting, credit, investment, liquidity, operational, cybernetic and emerging risks. These are actively monitored through periodic risk assessment updates and stress-tested under severe but plausible scenarios, such as climate change, cyberattacks, and catastrophic events, ensuring readiness and solvency resilience.
The company has adopted a proactive risk management approach, conducting regular stochastic simulations, sensitivity testing, and reverse stress testing. These assessments identify the most sensitive variables affecting solvency and profitability, such as claims volatility and PML assumptions. Mitigation measures include retrocession strategies, diversification of the underwriting portfolio, robust reserving methodologies, and strong governance practices.
Barents Re is not only solvent but strategically positioned to respond to future uncertainties without the need for capital injections or increased leverage. The organization emphasizes continuous improvement through policy updates, departmental involvement, robust internal controls and scenario-based planning. The company's solid ERM foundation supports long-term value creation while ensuring that risk exposures remain within appetite and tolerance thresholds approved by our Board of Directors.