Best’s News & Research Service - June 11, 2021 10:30 AM (EDT)
AM Best Affirms Credit Ratings of California Ins Co and Affiliates; Assigns Ratings to Oklahoma P and C Ins Co, Ashmere Ins Co
- June 11, 2021 10:30 AM (EDT)
Oldwick //BestWire// - AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICRs) of “a” (Excellent) of California Insurance Company (Foster City, CA), Continental Indemnity Company, Illinois Insurance Company, Texas Insurance Company (Dallas, TX) and Pennsylvania Insurance Company. All companies collectively are referred to as North American Casualty Group (NAC). The outlook of these Credit Ratings (ratings) is negative. Concurrently, AM Best has assigned an FSR of A (Excellent) and Long Term ICRs of “a” (Excellent) to Oklahoma Property and Casualty Insurance Company (Oklahoma City, OK) and Ashmere Insurance Company (Sarasota, FL). The outlook assigned to these ratings is negative. All companies are domiciled in Santa Fe, NM, unless otherwise specified.
The ratings reflect NAC’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.
The ratings assigned to Oklahoma Property and Casualty Insurance Company and Ashmere Insurance Company reflect their recent inclusion into the NAC pooling agreement. As a result, the companies’ performance and financial strength will be influenced heavily by the actions of the pool as a whole.
The continuation of the negative outlooks reflect the ongoing conservatorship, and associated litigation, with the California regulator. Although the conservatorship does not relate to the group’s financial strength, and is not anticipated to result in material losses to NAC, there remains some level of uncertainty to when and how the conservatorship will end, particularly regarding the business profile assessment. Additionally, the group’s underwriting ratios have trended unfavorably in recent years, as soft market conditions in workers’ compensation has persisted. The resolution of the negative outlooks is dependent on the resolution of the conservatorship and stabilization of underwriting performance metrics.
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.