Major Rating Factors:
History of adequate reserve strength (6.0 on a scale of 0 to 10) as reserves have been consistently at an acceptable level. Good overall profitability index (6.4) despite operating losses during 2018. Return on equity has been fair, averaging 5.9% over the past five years.
Other Rating Factors:
Good liquidity (6.9) with sufficient resources (cash flows and marketable investments) to handle a spike in claims. Good overall results on stability tests (5.1) despite weak results on operational trends. Strong long-term capitalization index (8.9) based on excellent current risk adjusted capital (severe and moderate loss scenarios). Moreover, capital levels have been consistent in recent years.
Stability Factors:
A - Financial problems or weaknesses of a parent or affiliate company.
T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business:
Fire (40.7%), comm multi (3.3%), med mal (1.0%), fin guar/surety (0.9%), work comp (0.5%), homeowners (0.5%), personal/comm auto (0.2%), other (53.0%)
Licensed in:
All states, the District of Columbia and Puerto Rico
Principal Investments:
Investment grade bonds (73.8%), non investment grade bonds (4.0%), cash (2.7%), common stock (1.3%), preferred stock (0.2%), other (18.0%)