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FOR IMMEDIATE RELEASE
OLDWICK - DECEMBER 07, 2023 03:11 PM (EST)
AM Best has revised the outlook to stable from positive for the Long-Term Issuer Credit Ratings (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term ICRs of “a” (Excellent) of Insurance Company of the West (headquartered in San Diego, CA) and its pooled subsidiaries, collectively referred to as ICW Group. (See below for a detailed listing of subsidiaries.) The outlook of the FSR is stable.
The Credit Ratings (ratings) reflect ICW Group’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.
The revised Long-Term ICR outlook to stable from positive reflects potential execution risks associated with aggressive growth in the group’s assumed reinsurance business, including the potential for more volatility in operating performance in the future and increased property aggregation risk as a result of this expansion. In addition, while the group’s balance sheet strength is supported by its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), this level of growth has led to a decline in the group’s risk-adjusted capitalization and its overall balance sheet strength. While the group maintains a strong position in California’s workers’ compensation (WC) market and has grown this business outside of California in recent years, ICW Group’s WC business remains concentrated in California, subjecting the group to the regulatory, judicial and economic environment of the state and its highly competitive market conditions.
The FSR of A (Excellent) and the Long-Term ICRs of “a” (Excellent) have been affirmed, with the outlooks of the Long-Term ICRs revised to stable from positive, while the outlook of the FSR is stable for the following pooled subsidiaries of Insurance Company of the West:
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 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.