DECEMBER 02, 2014 02:14 PM (EST)
A.M. Best Removes from Under Review and Affirms Ratings of Accredited Surety and Casualty Company, Inc.
FOR IMMEDIATE RELEASE
OLDWICK - DECEMBER 02, 2014 02:14 PM (EST)
The ratings of Accredited were placed under review with developing implications following the announcement by Randall & Quilter Investment Holdings Ltd. (R&Q) (Hamilton, Bermuda) [AIM: RQIH] that its wholly owned subsidiary, Randall & Quilter America Holdings Inc. had reached an agreement to acquire Accredited Holding Corporation, the parent company of Accredited. The transaction closed on Nov. 26, 2014.
The ratings of Accredited reflect its strong level of risk-adjusted capitalization, positive operating earnings and niche market position within the bail bond business. These positive rating attributes are partially offset by product concentration, which exposes the company's business to changes in laws and regulations related to bail bonds. Modest deterioration in underwriting and operating results and growth in net written premium that outpaced growth in surplus in the earlier years of the past five year period also continues to be an offsetting factor in the rating, although results have shown significant improvement in the most recent years. Based on discussions with management, A.M. Best anticipates no near-term changes in the operating profile or capitalization of Accredited.
While the outlook is stable for Accredited, negative rating actions could occur should operating performance or risk-adjusted capital levels fall short of A.M. Best's expectations.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Key insurance criteria reports utilized:
This press release relates to rating(s) that have been published on A.M. 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 visit A.M. Best's Ratings & Criteria Center .
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