OCTOBER 03, 2022 03:03 PM (EDT)
AM Best Withdraws Credit Ratings of EMC Reinsurance Company
|Raymond Thomson, CPCU, ARe, ARM|
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Manager, Public Relations
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FOR IMMEDIATE RELEASE
OLDWICK - OCTOBER 03, 2022 03:03 PM (EDT)
AM Best has downgraded the Financial Strength Rating to B++ (Good) from A (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb+” (Good) from “a” (Excellent) of EMC Reinsurance Company (EMC Re) (Des Moines, IA). The outlook of these Credit Ratings (ratings) has been revised to stable from negative. Concurrently, AM Best has withdrawn these ratings as the company’s management has requested to remove this entity from AM Best’s interactive rating process. The ratings of the members of EMC Insurance Companies and EMC National Life Company remain unchanged.
The ratings reflect EMC Re’s balance sheet strength, which AM Best assesses as very strong, as well as its marginal operating performance, very limited business profile and appropriate enterprise risk management.
The downgrade of EMC Re’s Long Term ICR reflects the significant volatility in underwriting performance in recent years, due to increasing losses from catastrophic weather events both domestically and internationally. This has hampered EMC Re’s net profitability and overall operating performance. In addition, the recent announcement that EMC Re will be exiting the assumed reinsurance business in 2023 leaves a very limited business profile.
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 use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
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.