Press Release - NOVEMBER 26, 2019

AM Best Upgrades Issuer Credit Rating of Texas Hospital Insurance Exchange


CONTACTS:
 Edward J. Zonenberg
Senior Financial Analyst
+1 908 439 2200, ext. 5135
edward.zonenberg@ambest.com

Vicky Riggs
Senior Financial Analyst
+1 908 439 2200, ext. 5039
vicky.riggs@ambest.com

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - NOVEMBER 26, 2019
AM Best has upgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb+” from “bbb” and affirmed the Financial Strength Rating (FSR) of B++ (Good) of Texas Hospital Insurance Exchange (THIE) (Austin, TX). The outlook of the Long Term ICR has been revised to stable from positive, while the outlook of the FSR remains stable.

These Credit Ratings (ratings) reflect THIE’s balance sheet strength, which AM Best categorizes as strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management (ERM).

The Long-Term ICR upgrade reflects AM Best’s opinion that THIE’s management has demonstrated improved balance sheet strength through consistent and positive growth in policyholder surplus, favorable loss reserve development, and the implementation of risk-mitigation strategies that address tail-risk events related to potential man-made catastrophes. The company’s strong operating performance was a major contributor to the growth in policyholder surplus.

The strong balance sheet strength assessment also considers THIE’s strongest level of risk-adjusted capitalization, partially offset by its limited scale and financial flexibility. In addition, a significant percentage of policyholder surplus pertains to subscriber savings, which are earmarked to be repaid to the company’s members, beginning five years after a subscriber leaves THIE.

Partially offsetting these positive rating factors is THIE’s limited business profile and narrow spread of risk due to its focus on writing workers’ compensation and medical professional liability insurance for small rural hospitals in Texas.

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.

AM Best is a global credit rating agency, news publisher and data provider specializing in the insurance industry. The company does business in more than 100 countries. Headquartered in Oldwick, NJ, AM Best has offices in cities around the world, including London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.


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AMB# Company Name
003650 Texas Hospital Insurance Exchange