AM Best Information Services

APRIL 16, 2021 11:21 AM (EDT)

AM Best Upgrades Issuer Credit Ratings of Members of Builders Mutual Insurance Group

 Jeffrey Stary, CPCU, ARe, ARM
Financial Analyst
+1 908 439 2200, ext. 5689

Raymond Thomson, CPCU, ARe, ARM
Associate Director
+1 908 439 2200, ext. 5621
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159

Jim Peavy
Director, Communications
+1 908 439 2200, ext. 5644


OLDWICK - APRIL 16, 2021 11:21 AM (EDT)
AM Best has upgraded the Long-Term Issuer Credit Ratings (Long-Term ICR) to “a+” from “a” and affirmed the Financial Strength Rating (FSR) of A (Excellent) of Builders Mutual Insurance Company and Builders Premier Insurance Company, collectively referred to as Builders Mutual Insurance Group (Builders Mutual) (Raleigh, NC). The outlook of the Long-Term ICR has been revised to stable from positive while the outlook for the FSR is stable.

The Credit Ratings (ratings) reflect Builders Mutual’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

The Long-Term ICR upgrades reflect consistent and profitable operating performance in recent years, including lower loss and loss adjustment expenses, combined and operating ratios; higher return on revenue and return on equity measures; and increased pre-tax operating and net income. The group has demonstrated sustained overall profitability and favorable comparisons with the results of peers in the workers’ compensation composite. Furthermore, the group has seen a substantial increase in net premiums written in the last five years supported by consistent organic growth in surplus.

The group’s relatively limited product line and concentration of business in the construction industry is offset largely by a prudent risk selection process, effective loss control practices, proactive claims management and long-term successful operations in the construction segment. The group maintains a high level of absolute capital, consistently favorable loss reserve development and solid liquidity measures. These positive factors are offset partially by some higher risk investments in the portfolio, as well as some elevated investment leverage measures. The stable outlooks reflect AM Best’s expectation that the group will maintain its strongest balance sheet strength assessment and that operating performance will continue to compare favorably with the workers’ compensation composite.

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 London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

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