Fitch Ratings has upgraded Oman Re’s Insurer Financial Strength (IFS) rating to “BBB” from “BBB-” with a stable outlook.
Fitch said the upgrade reflects reduced investment and asset risks following the upgrade of Oman’s sovereign rating to “BBB-” on December 8, 2025.
The ratings agency said reductions in investment and asset risk were the key drivers of the upgrade, noting a strong correlation between Oman Re’s financial health and sovereign credit quality.
Following the upgrade of Oman’s sovereign rating, Oman Re’s “risk assets” relative to capital ratio increased significantly, falling to 46% as of October 2025, down from 72% at the end of 2024.
The majority of the company’s investments (57% at end-2024) are held in Oman sovereign bonds and time deposits with local banks. As the sovereign rating improves, these assets are reclassified into less risky categories.
Fitch highlights the company’s capitalization as a key strength, supported by a “Strong” score in its Prism Global model, which it expects to remain unchanged through end-2025. The reinsurer maintains a healthy local solvency margin of 167% (end-2024) and operates with zero debt.
Despite challenges in the broader market, Fitch noted that Oman Re delivered strong financial results, with net profit after tax increasing by Omani riyal 3 million, driven by solid underwriting and investment returns.
The company also reported a combined ratio of 94% in 2024, which Fitch considers to be quite strong, even accounting for a small increase from flood losses in the UAE.
Although Oman Re has diversified franchises in the Middle East, Turkey and Central/Eastern Europe, Fitch noted that its operations remain small compared to global peers, with total reinsurance revenue of approximately Omani riyals ($130 million) in 2024.
The stable outlook reflects Fritsch’s expectation that the company will maintain its capital strength and underwriting discipline.
The rating agency said further upgrades could require another upgrade to Oman’s sovereign rating or a significant increase in the company’s size and scale while maintaining performance.
A downgrade of the sovereign rating or a drop in capitalization to the lower end of the “appropriate” range could trigger negative rating action.
