Major Rating Factors: Weak profitability index (2.6 on a scale of 0 to 10) with operating losses during 2017 and 2018. Return on equity has been fair, averaging 13.3% over the past five years. Weak overall results on stability tests (1.4). The largest net exposure for one risk is acceptable at 2.4% of capital.
Other Rating Factors: 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. Ample reserve history (7.4) that can protect against increases in claims costs. Excellent liquidity (7.0) with ample operational cash flow and liquid investments.
Stability Factors: D - Limited diversification of general business, policy, and/or investment risk. G - Fast asset or premium growth. T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business: Fin guar/surety (78.9%), other (21.1%)
Licensed in: PA
Principal Investments: Cash (24.9%), other (75.1%)