AM Best


AM Best Places Credit Ratings of Tri-State Consumer Insurance Company Under Review With Negative Implications


CONTACTS:

Dan Hofmeister, CFA
Financial Analyst
+1 908 439 2200, ext. 5385
dan.hofmeister@ambest.com

Joseph Burtone
Director
+1 908 439 2200, ext. 5125
joseph.burtone@ambest.com
Christopher Sharkey
Manager, Public Relations
(908) 439 2200, ext. 5159
christopher.sharkey@ambest.com

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

FOR IMMEDIATE RELEASE

OLDWICK - DECEMBER 10, 2018 04:22 PM (EST)
AM Best has placed under review with negative implications the Financial Strength Rating (FSR) of A- (Excellent) and the Long Term Issuer Credit Ratings (Long-Term ICR) of “a-” of Tri-State Consumer Insurance Company (Tri-State) (Jericho, NY).

This Credit Rating action follows the recent announcement that WT Holdings, Inc., Tri-State’s parent holding company, has entered into a definitive agreement with Standard Diversified Inc. (SDI) under which SDI will acquire Tri-State. Each side’s board of directors has approved the agreement, and the transaction, subject to customary closing conditions and regulatory approval, is expected to close in 2019.

The negative implications status reflects the uncertainty regarding the future business model and capitalization of Tri-State under SDI, as well as the potential financial leverage of the new holding company. Additionally, the ratings of Tri-State had previously been assigned a negative outlook on Jan. 17, 2018, based on deteriorating trends in underwriting performance. AM Best has concerns regarding Tri-State’s overall operating performance as negative underwriting results have continued through Sept. 30, 2018. These ratings will remain under review pending completion of the transaction and AM Best’s review of this transaction. AM Best will continue to hold discussions with Tri-State management and monitor the company’s balance sheet strength, operating performance, business profile and enterprise risk management.

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 rating agency and information provider with a unique focus on the insurance industry.


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