AM Best has upgraded the Financial Strength Rating (FSR) to A- (Excellent) from B++ (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) to "a-" (Excellent) from "bbb+" (Good) of Black Gold Re Limited (BGRe) (Bermuda). The outlook of these Credit Ratings (ratings) has been revised to stable from positive.

The ratings reflect BGRe's balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The upgrading of these ratings also reflects BGRe's consistently robust balance sheet fundamentals, supported by strong internal capital generation and a sustained trend of risk-adjusted capitalization at the strongest level, as measured by Best's Capital Adequacy Ratio (BCAR). This position is supported by a comfortable buffer and is expected to be sustained over the medium term. The company's balance sheet strength is further reinforced by efficient capital management practices, a conservative asset-liability management (ALM) framework and low underwriting leverage.

BGRe made an initial dividend payment in 2025 to its parent company and anticipates future distributions. However, they are expected to be aligned with the BGRe's capital management approach and not to materially weaken the company's balance sheet strength.

BGRe is a captive reinsurer of Ecopetrol S.A. (Ecopetrol) (NYSE:EC), a Colombia-based integrated energy company that is 88.5% owned by Colombia's government. The ratings also recognize the importance of the company within Ecopetrol's strategy. Through a dual insurance program structure, BGRe provides reinsurance to the Ecopetrol group, focusing on specialized property/casualty lines while maintaining a prudent risk retention profile.

The company continues to demonstrate a solid track record of profitable underwriting performance, as evidenced by sustained low combined ratios (on a net/net, IFRS 17 basis). BGRe's performance reflects disciplined loss ratio management, underpinned by a robust retrocession program, effective expense management and stable ceding commission income. AM Best expects BGRe to maintain premium sufficiency, supported by disciplined underwriting.

AM Best views the company's business profile as neutral. BGRe benefits from access to a wide scope of insured risks, reflecting Ecopetrol's relevance within the oil and gas industry in the Americas. Nonetheless, the company's portfolio is concentrated in Colombia.

AM Best considers BGRe's ERM to be appropriate as it is well-integrated within Ecopetrol and is important to the group as a cost-effective risk management tool.

Negative rating actions could arise following a material deterioration in liquidity and leverage metrics, adverse changes in the ALM profile, or a weakening of its risk-adjusted capitalization as result of large losses and/or capital outflows. Negative rating pressure could arise if the credit profile of the parent company, Ecopetrol, weakens. Although unlikely in the medium term, positive rating actions could result from a sustained improvement in the operating performance of BGRe.

This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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Frida García

Associate Financial Analyst

+52 55 1102 2720, ext. 133

frida.garcia@ambest.com

Alfonso Novelo

Senior Director, Analytics

+52 55 1102 2720, ext. 107

alfonso.novelo@ambest.com

Christopher Sharkey

Associate Director, Public Relations

+1 908 882 2310

christopher.sharkey@ambest.com

Al Slavin

Senior Public Relations Specialist

+1 908 882 2318

al.slavin@ambest.com

AM Best Upgrades Credit Ratings of Black Gold Re Limited