TOWER HILL PREFERRED INS CO
Major Rating Factors:
Weak profitability index (0.8 on a scale of 0 to 10) with operating losses during each of the last five years. Average return on equity over the last five years has been poor at -23.8%. Vulnerable liquidity (0.9) as a spike in claims may stretch capacity.
Other Rating Factors:
Weak overall results on stability tests (1.3) including weak financial strength of affiliated Tower Hill Group, weak results on operational trends and negative cash flow from operations for 2022. The largest net exposure for one risk is acceptable at 3.0% of capital. Fair long-term capitalization index (3.2) based on fair current risk adjusted capital (moderate loss scenario). Fair reserve development (4.1) as reserves have generally been sufficient to cover claims.
Stability Factors:
D - Limited diversification of general business, policy, and/or investment risk.
F - Negative cash flow.
L - Past results on our liquidity tests.
R - Concerns about the financial strength of its reinsurers.
Principal Lines of Business:
Homeowners (93.9%), fire (1.3%), other (4.7%)
Licensed in:
FL
Principal Investments:
Investment grade bonds (61.2%), non investment grade bonds (2.0%), common stock (0.2%), other (36.7%)