Major Rating Factors:
Weak profitability index (2.0 on a scale of 0 to 10) with operating losses during 2018, 2020 and 2021. Average return on equity over the last five years has been poor at -17.1%. Weak overall results on stability tests (1.1) including weak financial strength of affiliated Enstar Group Ltd, weak results on operational trends and negative cash flow from operations for 2022.
Other Rating Factors:
Good long-term capitalization index (6.6) based on good current risk adjusted capital (moderate loss scenario). Ample reserve history (7.1) that can protect against increases in claims costs. Excellent liquidity (7.0) with ample operational cash flow and liquid investments.
Stability Factors:
F - Negative cash flow.
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 (76.1%), personal/comm auto (9.3%), other (14.6%)
Licensed in:
All states except PR
Principal Investments:
Investment grade bonds (43.1%), common stock (41.2%), cash (12.6%), non investment grade bonds (0.4%), other (2.6%)