Major Rating Factors:
Fair reserve development (4.7 on a scale of 0 to 10) as reserves have generally been sufficient to cover claims. Fair overall results on stability tests (4.6) including weak results on operational trends and excessive premium growth. The largest net exposure for one risk is conservative at 1.2% of capital.
Other Rating Factors:
Good liquidity (6.8) with sufficient resources (cash flows and marketable investments) to handle a spike in claims. Strong long-term capitalization index (7.3) based on excellent current risk adjusted capital (severe and moderate loss scenarios), despite some fluctuation in capital levels. Excellent profitability (7.7) with operating gains in each of the last five years. Return on equity has been good over the last five years, averaging 10.6%.
Stability Factors:
R - Concerns about the financial strength of its reinsurers.
T - Significant trends in critical asset, liability, income or expense items.
Principal Lines of Business:
Fire (10.2%), comm multi (9.1%), product liab. (3.9%), other (76.8%)
Licensed in:
All states, the District of Columbia and Puerto Rico
Principal Investments:
Investment grade bonds (57.5%), common stock (33.1%), non investment grade bonds (3.5%), cash (0.7%), real estate (0.2%), preferred stock (0.1%), other (4.8%)