Major Rating Factors: Fair overall results on stability tests (3.9 on a scale of 0 to 10). History of adequate reserve strength (5.4) as reserves have been consistently at an acceptable level.
Other Rating Factors: Good overall profitability index (6.4). Fair expense controls. Return on equity has been low, averaging 4.4% over the past five years. Good liquidity (6.5) with sufficient resources (cash flows and marketable investments) to handle a spike in claims. Strong long-term capitalization index (8.3) 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. R - Concerns about the financial strength of its reinsurers. T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business: Personal/comm auto (38.7%), homeowners (37.2%), fire (5.1%), comm multi (0.6%), fin guar/surety (0.6%), other (17.7%)
Licensed in: All states except PR
Principal Investments: Investment grade bonds (64.0%), non investment grade bonds (6.9%), common stock (5.5%), cash (0.2%), other (23.4%)