Press Release - MARCH 14, 2019
AM Best Upgrades Credit Ratings of Members of Castle Key Group
FOR IMMEDIATE RELEASE
OLDWICK - MARCH 14, 2019
The ratings reflect Castle Key’s balance sheet strength, which AM Best categorizes as adequate, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
The ratings upgrade is based on the improvement in Castle Key’s balance sheet strength, with consistent organic surplus growth and a strengthened catastrophe reinsurance program that now responds to more severe windstorm events. As a dedicated Florida property writer for its parent company, Allstate Insurance Company (Allstate), Castle Key maintains significant exposure to hurricanes, with a corresponding substantial reliance on catastrophe reinsurance.
Castle Key has posted operating profitability and surplus accumulation over the last several years despite periodic catastrophe losses brought on by hurricanes Hermine and Matthew in 2016, Irma in 2017 and Michael in 2018. Even with the losses associated with these storms, Castle Key did not suffer any material impact to the group’s risk-adjusted capital position.
The ratings also benefit from the historical financial and operational support provided to Castle Key as part of the Allstate organization. Castle Key is capitalized separately and not reinsured by Allstate, but it is AM Best’s expectation that Allstate would provide sufficient support if necessary to maintain Castle Key’s risk-adjusted capital at a level commensurate with its rating level in the event of frequent or severe hurricane activity.
The FSRs have been upgraded to B+ (Good) from B- (Fair) and the Long-Term ICRs to “bbb-” from “bb-” with a stable outlook for the following members of the Castle Key Group:
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 Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
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