AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of "a+" (Excellent) for Royal Bank of Canada Insurance Company Ltd. (RBCICL). The outlook for these credit ratings is stable. The affirmation reflects RBCICL’s very strong balance sheet strength, strong operating performance, neutral business profile, and appropriate enterprise risk management.

RBCICL is a profitable subsidiary of Royal Bank of Canada (RBC), the largest bank in Canada by market capitalization. The company executes its strategy of reinsuring and managing Canadian Creditor Life, Longevity, and other international insurance products. RBCICL holds a contractual service margin (CSM) liability for its profitable reinsurance contracts under the general measurement model of IFRS 17. This CSM contributed to a decline in reported capital upon the transition to IFRS 17, effective November 1, 2023, but is expected to be released into earnings over time.

The company reported a total net income of CAD 707.8 million, driven by a strong insurance service result of CAD 700.8 million. The parent bank, RBC, holds approximately CAD 139 billion of IFRS equity at financial year-end 2025 and over CAD 2.3 trillion in assets. The RBC group earned approximately CAD 20.4 billion in net income on CAD 66.75 billion in revenue in fiscal year 2025. AM Best notes that while RBC does not guarantee support, it may provide additional capital at its discretion should RBCICL need to maintain its risk-adjusted capitalization levels.

Financial Performance

The following table details the financial metrics reported by RBCICL and its parent group:

The Financial Consumer Agency of Canada (FCAC) imposed an administrative monetary penalty of $4.25 million on the Royal Bank of Canada (RBC) for violating consumer provisions in the Bank Act. RBC failed to transfer credits from deactivated credit card accounts to customers' new accounts, resulting in inaccurate monthly statements and additional charges for some clients. This failure to ensure accurate disclosure affected 227,947 accounts financially.

RBC has transferred and refunded more than $22.4 million to impacted customers. For customers who could not be identified, preventing direct refunds, RBC made a charitable donation of $299,000. The violation is detailed in Summary of Proceeding #5, published by the FCAC on June 25, 2026.

Regulatory Implications

Accurate disclosure is a foundational element of the consumer protection provisions of the Bank Act. The FCAC emphasized that consumers must receive accurate information to make informed financial decisions. All federally regulated financial institutions are expected to review the findings of FCAC decisions and summaries of proceedings to apply them to their own practices.

Financial Impact

The following table outlines the financial remediation undertaken by RBC: