Major Rating Factors:
Weak overall results on stability tests (2.3 on a scale of 0 to 10) including weak results on operational trends, weak risk adjusted capital in prior years and negative cash flow from operations for 2022. Strengths include potentially strong support from affiliation with XL Group Ltd. Poor long-term capitalization index (2.0) based on weak current risk adjusted capital (severe and moderate loss scenarios).
Other Rating Factors:
Weak profitability index (0.8) with operating losses during each of the last five years. Average return on equity over the last five years has been poor at -93.1%. History of adequate reserve strength (5.6) as reserves have been consistently at an acceptable level. Good liquidity (6.3) with sufficient resources (cash flows and marketable investments) to handle a spike in claims.
Stability Factors:
C - Past results on our Risk-Adjusted Capital tests.
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:
Personal/comm auto (100.0%)
Licensed in:
All states except PR
Principal Investments:
Cash (69.9%), investment grade bonds (24.3%), other (5.8%)