Major Rating Factors: History of adequate reserve strength (5.0 on a scale of 0 to 10) as reserves have been consistently at an acceptable level. Good overall profitability index (6.9). Weak expense controls. Return on equity has been low, averaging 3.3% over the past five years.
Other Rating Factors: Fair overall results on stability tests (4.0). Strong long-term capitalization index (10.0) based on excellent current risk adjusted capital (severe and moderate loss scenarios). Moreover, capital levels have been consistent in recent years. Superior liquidity (9.2) 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: Homeowners (41.2%), fire (19.4%), personal/comm auto (18.0%), other (21.4%)
Licensed in: All states except PR
Principal Investments: Investment grade bonds (93.4%), common stock (3.7%), non investment grade bonds (0.8%), real estate (0.4%), other (1.7%)