Major Rating Factors: Weak overall results on stability tests (2.8) including weak financial strength of affiliated Fairfax Financial and weak results on operational trends.
Other Rating Factors: Strong long-term capitalization index (9.9) based on excellent current risk adjusted capital (severe and moderate loss scenarios), despite some fluctuation in capital levels. Excellent profitability (7.2) despite modest operating losses during 2017. Superior liquidity (10.0) with ample operational cash flow and liquid investments.
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: Comm multi (72.5%), fire (7.2%), personal/comm auto (2.5%), fin guar/surety (1.6%), work comp (0.7%), other (15.6%)
Licensed in: All states, the District of Columbia and Puerto Rico
Principal Investments: Investment grade bonds (48.2%), common stock (33.1%), cash (18.7%), other (0.1%)