Best’s News & Research Service - January 28, 2022 03:06 PM (EST)
AM Best Removes From Under Review; Affirms Credit Ratings of StarStone Specialty Insurance Co and StarStone National Ins Co
- January 28, 2022 03:06 PM (EST)
Oldwick //BestWire// - AM Best has removed from under review with developing implications and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” (Excellent) of StarStone Specialty Insurance Company and StarStone National Insurance Company (collectively Core Specialty), which are domiciled in Wilmington, DE and subsidiaries of Core Specialty Insurance Holdings, Inc. The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect Core Specialty’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.
These rating actions follow the closing of Core Specialty’s merger with Lancer Insurance Group (Lancer). The merger was executed via a stock and cash transaction announced on April 16, 2021. This merger with Lancer marks Core Specialty’s first merger or acquisition since the recapitalization of StarStone US Holdings, Inc. in November 2020. Lancer will operate as a division of Core Specialty, retaining its legacy branding, management team, and operating locations. Additionally, Dave Delany, co-founder and CEO of Lancer, has joined the board of Core Specialty.
AM Best has analyzed the initial pro-forma combined position of the two groups and determined that the risk-adjusted capitalization position remains in the strongest category, as measured by Best’s Capital Adequacy Ratio (BCAR). While it is anticipated that the combination of the groups could have an accretive impact on their business profiles, further integration will need to take place before these benefits are realized. AM Best will continue to monitor the group as it approaches the closing of year-end financials, and will likely reassess the impact once the final year-end 2021 audit is completed.
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 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.