JUNE 26, 2020 04:04 PM (EDT)
AM Best Revises Outlooks to Negative for Trans City Casualty Insurance Company and Trans-City Life Insurance Company
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FOR IMMEDIATE RELEASE
OLDWICK - JUNE 26, 2020 04:04 PM (EDT)
AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-“ for Trans City Casualty Insurance Company (TCC) and Trans-City Life Insurance Company (TCL). Both companies are domiciled in Scottsdale, AZ.
The Credit Ratings (ratings) of TCC reflect its balance sheet strength, which AM Best categorizes as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management (ERM). TCL’s ratings reflect its balance sheet strength, which AM Best categorizes as strong, as well as its adequate operating performance, limited business profile, appropriate ERM and support from TCC.
The revision of the outlooks to negative reflect the year-over-year decline in operating performance and uncertainty of the current workers’ compensation marketplace and macroeconomic conditions affecting automobile dealership groups in Arizona. The company has seen a consistent decline in premium volume, and will remain challenged to grow its business. As a result, key operating performance metrics, such as underwriting and operating cash flows, as well as its expense ratio, have been negatively impacted. If these trends continue, there could be a downward revision in the company’s operating performance building-block assessment, which also would affect the level of support available to TCL and reduce the amount of rating lift by one notch.
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.