Two of the insurance industry's major rating agencies have now moved Canopius Reinsurance Limited's outlook to Positive within three months of each other. Fitch Ratings made that revision on July 13 and affirmed the insurer financial strength rating at 'A'. AM Best had taken the same step in April, at which point it affirmed a financial strength rating of A- (Excellent).
Fitch attributed the outlook change to expectations that Canopius Re's company profile will improve over the next few years, supported by profitable premium growth and broader business diversification. The rating is assessed on the consolidated accounts of Fortuna MidCo Limited (FML), the intermediate holding company of Canopius.
The backdrop is a period of rapid expansion. Canopius Group reported insurance contract written premium of US$4.48 billion for 2025, up 27% year-on-year and nearly double the 2022 figure. Syndicate 4444, the group's flagship Lloyd's vehicle, overtook Beazley's Syndicate 2623 to become the largest syndicate at Lloyd's for the 2025 year of account.
Fitch recorded insurance revenue at FML of approximately US$4.1 billion at end-2025, up from US$3.1 billion at end-2024. Premium growth is expected to continue in 2026, though at a slower pace given softening market conditions.
Fitch calculated FML's undiscounted combined ratio at 87.7% for 2025, an improvement from 88.5% in 2024. Investment income rose to US$226 million from US$192 million, supported by high reinvestment yields. FML reported a net return on equity of 21% at end-2025, against 22% the prior year.
Canopius' capital surplus stood at 141% above its capital requirement at end-2025, compared with 147% at end-2024. FML's Prism Global Model score remained at 'Strong', driven by higher retained earnings and a stronger equity base. Financial gearing fell to 14% in 2025 from 17% in 2024, as the equity base strengthened against stable debt levels.
Fitch expects FML's undiscounted combined ratio to remain in the low-90s in 2026, underpinned by disciplined underwriting and continued reductions in natural catastrophe exposure. Fixed-maturity investments and cash and cash equivalents comprised around 90% of assets at end-2025, concentrated in investment-grade securities with short duration.
Canopius Re is domiciled in Bermuda and provides internal quota-share reinsurance for the group's Lloyd's business. It also writes third-party casualty, property, marine, and specialty reinsurance, along with management and professional lines. Fitch classifies the entity as a core subsidiary of the group.
A sustained upgrade to 'A+' would require Fitch's Prism score at FML level to reach the 'Very Strong' range consistently. A reversal to Stable could follow a failure to sustain profitable growth or sufficient diversification.
