Major Rating Factors: Poor long-term capitalization index (1.0 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 good range over the last two years. Weak overall results on stability tests (1.6) including excessive premium growth and weak risk adjusted capital in prior years. The largest net exposure for one risk is conservative at 1.8% of capital.
Other Rating Factors: Fair reserve development (3.9) as reserves have generally been sufficient to cover claims. Fair profitability index (3.5) with operating losses during each of the last five years and the first six months of 2022. Average return on equity over the last five years has been poor at -11.1%. Excellent liquidity (7.0) with ample operational cash flow and liquid investments.
Stability Factors: C - Past results on our Risk-Adjusted Capital tests. G - Fast asset or premium growth. R - Concerns about the financial strength of its reinsurers. T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business: Personal/comm auto (100.0%)
Licensed in: All states except TN, PR
Principal Investments: Investment grade bonds (63.3%), cash (16.9%), other (19.7%)