Best’s News & Research Service - September 19, 2025 02:53 PM (EDT)
AM Best Revises Issuer Credit Rating Outlook to Positive for National Unity Insurance Company
- September 19, 2025 02:53 PM (EDT)
//BestWire// - AM Best has revised the outlook to positive from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term ICR of “bbb” (Good) of National Unity Insurance Company (National Unity) (San Antonio, TX). The outlook of the FSR is stable.
The Credit Ratings (ratings) reflect National Unity’s balance sheet strength, which AM Best assesses as adequate, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.
The revised Long-Term ICR outlook to positive from stable reflects consistent, sustained improvement in balance sheet metrics since National Unity exited the domestic non-standard auto line of business in 2020, which was the driver of significant volatility in operating results, as well its risk-adjusted capitalization and surplus position. The exit from this line of business has stabilized results and caused risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), to increase and remain at the strongest level for consecutive cycles, which has resulted in surplus additions in each of the past five years. Additionally, the company’s net and gross leverage metrics have displayed a favorable trend in consecutive years and outperform the commercial automobile composite average. Volatility in the company’s balance sheet metrics is reduced further by common stock leverage in the low single digits, reducing the exposure to volatility in equity markets. Despite this, the company’s investment yield and investment income have increased and remained consistent thanks to a conservative investment portfolio primarily made up of bonds. Underwriting and operating cash flows have been positive in each of the prior five years and contribute to overall and current liquidity ratios that exceed the composite averages.
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 (BCR), Best’s Performance Assessments (PA), Best’s Preliminary Credit Assessments (PCA) 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.