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FOR IMMEDIATE RELEASE
OLDWICK - JUNE 09, 2021 10:41 AM (EDT)
AM Best has downgraded the Financial Strength Rating (FSR) to B++ (Good) from A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb+” (Good) from “a-” (Excellent) of Architects & Engineers Insurance Company, A Risk Retention Group (AEIC) (Delaware). The outlook of the Long-Term ICR has been revised to negative from stable, while the FSR outlook is stable. Concurrently, AM Best has withdrawn the ratings as the company has requested to no longer participate in AM Best’s interactive ratings process.
The Credit Ratings (ratings) reflect AEIC’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
The rating downgrades reflect a change in AM Best’s assessment of AEIC’s operating performance as the company discontinued writing new business effective March 31, 2021. AM Best expects AEIC’s policyholder obligations to run off over the period through 2022, since the majority of the book of business consisted of multi-year policies. The negative outlook of the Long-Term ICR reflects uncertainty surrounding AEIC’s balance sheet strength as it executes its run-off strategy. In the near term, AM Best expects AEIC’s balance sheet strength to remain very strong and supported by risk-adjusted capitalization at the strongest level, as measured by Best Capital Adequacy Ratio (BCAR), with liquidity and cash flows sufficient to meet its policyholder obligations.
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.