Senior Financial Analyst
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Manager, Public Relations
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Director, Public Relations
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FOR IMMEDIATE RELEASE
OLDWICK - OCTOBER 09, 2018 02:47 PM (EDT)
A.M. Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” of Aspire General Insurance Company (Aspire General) (Rancho Cucamonga, CA).
The ratings reflect Aspire General’s balance sheet strength, which A.M. Best categorizes as adequate, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management.
The revised outlooks to stable from negative reflect Aspire General’s strong risk-adjusted capitalization, improved operating performance in recent years and senior management’s operating experience and in-depth knowledge of California’s private passenger non-standard automobile market. Additionally, the company is technologically advanced for its size and utilizes predictive analytics in decision making with a heavy emphasis on managing loss frequency. Furthermore, data analytics and point-of-sale tools are used to quickly target profitable segments and swiftly react to new business rate needs. Lastly, ownership has contributed capital to Aspire General in recent years to support new business growth, along with increasing its quota share cession in 2018 for surplus relief.
Partially offsetting these positive ratings factors are Aspire General’s above-average underwriting leverage, below-average liquidity measures and high reinsurance dependence. The company also has execution risk as a start-up, associated with growing its private passenger non-standard automobile book of business, a segment in which smaller insurance writers have experienced a material deterioration in operating results and policyholders’ surplus in recent years. The general deterioration in the non-standard automobile line of business has been partially driven by economic conditions, significant price competition and adverse selection from large personal automobile writers with greater scale and pricing granularity.
This press release relates to Credit Ratings 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 see A.M. 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 A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.
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