A.M. Best Co. has assigned a financial strength rating of ‘A-‘ (Excellent) and issuer credit rating of “a-” to CastlePoint Florida Insurance Company with stable outlooks. “CFIC is a newly formed insurance company that received a certificate of authority from the Florida Insurance Department on February 19, 2009,” Best noted. “The ratings reflect the explicit support provided by its parent, New York-based CastlePoint Insurance Company (CPIC) in the form of a 90 percent quota share reinsurance agreement. CPIC is ultimately owned by Tower Group, Inc.” Best explained that “CFIC is expected to write small- to medium-sized workers’ compensation and commercial automobile insurance coverages in Florida. This business had previously been written by a third party fronting carrier and assumed by CPIC. Tower, through its subsidiaries offers a broad range of specialized property/casualty insurance products and services to small- and mid-sized businesses and individuals primarily in the North East, Florida, Texas and California.”
A.M. Best Co. has revised the outlook to positive from stable and affirmed the financial strength rating (FSR) of ‘A-‘ (Excellent) and issuer credit ratings (ICR) of “a-” of Calif.-based Doctors Company Insurance Group (TDC) and its members. “The ratings reflect TDC’s strong operating performance, excellent risk-adjusted capitalization, improved reserve development, appropriate cycle management and leading position within the medical professional liability sector.” Best added that it also “recognizes the group’s geographic diversification, which has been supported by the successful integration of recent acquisition driven growth.” However, “the challenges associated with the medical professional liability insurance sector as it relates to price competition, legislative (tort) reform, loss cost trends and regulatory challenges,” should all be considered as offsetting factors. “An additional factor is the history of moderate fluctuations in TDC’s earlier operating results, driven by adverse reserve development in prior accident years. However, reserve development since 2004 has been favorable, reflecting management’s corrective actions and general market conditions. In addition to TDC, Best has also affirmed the FSR’s of ‘B+’ (Good) and ICRs of “bbb-” to SCPIE Indemnity Company (Los Angeles), American Healthcare Specialty Insurance Company, (Little Rock, Ark.) and American Healthcare Indemnity Company (Wilmington, Del.), also with stable outlooks. Best noted that these “companies were acquired by TDC on June 30, 2008. Prior to January 1, 2009, these three entities were rated by A.M. Best under a pooled affiliation. Currently, the pooling agreement is no longer in place, and each of these companies is rated separately. Support for these ratings is provided by the companies’ appropriate risk-adjusted capital positions.” Best has also withdrawn the FSR of ‘B+’ (Good) and ICRs of “bbb-” and assigned a category NR-5 to the FSR and an “nr” to the ICRs of the previously existing group, The SCPIE Companies.
A.M. Best Co. has affirmed the financial strength rating (FSR) of ‘A-‘ (Excellent) and issuer credit ratings (ICR) of “a-” of Meadowbrook Insurance Group and its pooled members. Best also affirmed the ICR of “bbb-” of the parent holding company, Michigan-based Meadowbrook Insurance Group, Inc. The outlook for all ratings is stable. “These ratings reflect Meadowbrook’s sustained operating profitability, despite investment and catastrophe losses in 2008 and continued soft market conditions, its supportive capitalization and management’s expertise in both the specialty program business and alternative risk market,” said Best. The rating agency also said it “recognizes Meadowbrook’s ability to offer full service excess and surplus lines capabilities following MIGI’s July 2008 merger with ProCentury Corporation. MIGI’s financial leverage (total debt/total capital) was elevated to 23.1 percent at March 31, 2009 as a result of the aforementioned transaction with ProCentury but remains within A.M. Best’s standards for the current ratings, and interest coverage remains solid. As of January 1, 2009, the two reinsurance pooling agreements that were in place through December 31, 2008—the first consisting of the existing Meadowbrook companies and the other comprised of the ProCentury companies—were terminated on a cut-off, and the six insurance affiliates became parties to one collective intercompany reinsurance pooling agreement. Accordingly, the rating of the former, separate Century Insurance Group has been withdrawn.”
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