Major Rating Factors: Fair profitability index (3.6 on a scale of 0 to 10) with operating losses during each of the last five years and the first nine months of 2020. Average return on equity over the last five years has been poor at -2.6%.
Other Rating Factors: Weak overall results on stability tests (2.4) including negative cash flow from operations for 2019. Strong long-term capitalization index (10.0) based on excellent current risk adjusted capital (severe and moderate loss scenarios), despite some fluctuation in capital levels. Superior liquidity (10.0) with ample operational cash flow and liquid investments.
Stability Factors: D - Limited diversification of general business, policy, and/or investment risk. F - Negative cash flow. T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business: Work comp (98.9%), comm multi (0.6%), personal/comm auto (0.5%)
Licensed in: AZ, CO, NV, NM, UT
Principal Investments: Investment grade bonds (96.1%), cash (0.6%), other (3.3%)