Best’s News & Research Service - January 25, 2008 12:25 PM (EST)
A.M. Best Assigns a Positive Outlook to Ullico Casualty
OLDWICK, N.J. //BestWire// - A.M. Best Co. has assigned an issuer credit rating (ICR) of “bbb-”and affirmed the financial strength rating (FSR) of B+ (Good) of Ullico Casualty Company (Ullico Casualty) (Delaware). The outlook for the FSR has been revised to positive from stable, and the outlook assigned to the ICR is positive.
In addition, A.M. Best has assigned an ICR of “bbb-” and affirmed the FSR of B+ (Good) of The Union Labor Life Insurance Company (Union Labor Life) (Silver Springs, MD). The outlook for the FSR is stable, and the outlook assigned to the ICR is stable. Concurrently, A.M. Best has assigned an ICR of “bb-” and affirmed the FSR of B- (Fair) of Ulico Standard of America Casualty Company (USA Casualty) (California). The outlook for the FSR is stable, and the outlook assigned to the ICR is stable. These companies are wholly owned subsidiaries of the holding company, ULLICO Inc. (Maryland).
The positive outlook reflects Ullico Casualty’s continued improvement in a number of key areas that have led to strengthened capitalization, operating performance and internal control standards. Recently, Ullico Casualty has re-entered the commercial lines of insurance on a limited basis in key union states to complement its core product lines of fiduciary liability and union general liability insurance.
The affirmation of the FSR for Union Labor Life recognizes its improved balance sheet position and operational strategy as well as its established niche in the increasingly competitive Taft-Hartley market. Although net income was lower in 2007 due to the settlement of a five-year old issue with the U.S. Department of Labor, the company made progress through profitable growth in its core lines of business and the development of a stronger financial foundation through the implementation of new products and services.
The ratings and outlook of USA Casualty, which is in runoff, are based on the formal guarantee approved by the California Department of Insurance whereby ULLICO, Inc. guarantees to maintain USA Casualty’s statutory surplus at an amount above the NAIC Risk-Based Capital Company Action Level.
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