Major Rating Factors: Poor long-term capitalization index (1.3 on a scale of 0 to 10) based on weak current risk adjusted capital (severe and moderate loss scenarios), although results have slipped from the excellent range over the last two years. Weak profitability index (0.2) with operating losses during 2017, 2018, 2019 and the first three months of 2021. Average return on equity over the last five years has been poor at -79.9%.
Other Rating Factors: Vulnerable liquidity (0.0) as a spike in claims may stretch capacity. Weak overall results on stability tests (0.9) including weak risk adjusted capital in prior years and negative cash flow from operations for 2020. Fair reserve development (4.5) as reserves have generally been sufficient to cover claims.
Stability Factors: C - Past results on our Risk-Adjusted Capital tests. F - Negative cash flow. G - Fast asset or premium growth. L - Past results on our liquidity tests.
Principal Lines of Business: Homeowners (67.9%), fire (30.1%), other (2.0%)
Licensed in: FL, LA, MS, SC
Principal Investments: Investment grade bonds (57.1%), cash (32.7%), real estate (8.2%), common stock (2.0%)