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FOR IMMEDIATE RELEASE
OLDWICK - FEBRUARY 19, 2020 08:29 AM (EST)
AM Best has upgraded the Financial Strength Rating to B++ (Good) from B+ (Good) and the Long-Term Issuer Credit Rating to “bbb” from “bbb-” of Hanover Fire & Casualty Insurance Company (HFCIC) (King of Prussia, PA). The outlook of these Credit Ratings (ratings) has been revised to stable from positive.
These Credit Ratings (ratings) reflect HFCIC’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 reflects sustained improvement to HFCIC’s balance sheet strength, reflective of the strongest level of risk-adjusted capitalization and organic surplus growth over the past five years. Additionally, the company’s adequate balance sheet strength reflects the overall solid liquidity measures that are enhanced by positive underwriting and operating cash flows, and its fairly conservative investment portfolio. However, partially offsetting the positive factors is the company’s elevated underwriting leverage, which compares unfavorably with the personal property composite average; this was primarily driven by the company’s premium growth outpacing its surplus growth over the past five years. Despite this, management has displayed its commitment to HFCIC by paying off the holding company debt at Hanover Fire Holdings, Inc., which has decreased 47% in the past two years.
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 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 analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.