Best’s News & Research Service - March 02, 2022 02:06 PM (EST)
AM Best Assigns Preliminary Credit Assessment to PURE Specialty Exchange
- March 02, 2022 02:06 PM (EST)
Oldwick //BestWire// - AM Best has assigned a Preliminary Credit Assessment (PCA) to PURE Specialty Exchange (PSE) (Scottsdale, AZ) with a Financial Strength Assessment of A pca (Excellent) and a Long-Term Issuer Credit Assessment of “a” pca (Excellent). The outlook assigned to this PCA is stable.
The PCA reflects PSE’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 (ERM).
This PCA assignment considers the implicit and explicit support provided by its affiliate, Tokio Marine Holdings, Inc., and its lead insurance operating company, Tokio Marine & Nichido Fire Insurance Co., Ltd.
The very strong balance sheet assessment reflects PSE’s strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), on a pro forma basis for an expected initial capitalization via surplus notes issued by PSE to Privilege Underwriters, Inc. AM Best expects PSE’s risk-adjusted capitalization to remain within the strongest category with additional positive assessment factors contributing, including financial flexibility, quality of assets and its conservative investment portfolio. Partially offsetting these strengths is PSE’s exposure to catastrophe losses and expected reliance on reinsurance.
AM Best assesses the company’s operating performance as adequate based on PSE’s projections and the fact that the anticipated writings and associated historical loss ratios are well known to the company. AM Best views the company’s business profile as limited given that PSE is a startup entity and will be geographically concentrated in New York, California, South Carolina, North Carolina and Massachusetts. PSE’s ERM capabilities benefit from overall framework developed at the ultimate parent level.
This press release relates to Preliminary Credit Assessments that have been published on AM Best’s website. For all assessment information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual assessments 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 and Assessment 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.