Major Rating Factors: Weak overall results on stability tests (1.9 on a scale of 0 to 10) including potential drain of affiliation with ProAssurance Corp. History of adequate reserve strength (6.9) as reserves have been consistently at an acceptable level.
Other Rating Factors: Good overall profitability index (5.1). Fair expense controls. Return on equity has been good over the last five years, averaging 11.7%. Good liquidity (5.9) with sufficient resources (cash flows and marketable investments) to handle a spike in claims. Strong long-term capitalization index (7.9) based on excellent current risk adjusted capital (severe and moderate loss scenarios), despite some fluctuation in capital levels.
Stability Factors: R - Concerns about the financial strength of its reinsurers. T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business: Work comp (99.8%), other (0.2%)
Licensed in: All states except AK, CA, HI, ID, ND, OR, WA, WY, PR
Principal Investments: Investment grade bonds (61.8%), non investment grade bonds (10.6%), cash (3.2%), preferred stock (0.6%), other (23.9%)