AM Best Revises Outlooks to Positive for Arbella Insurance Group Members
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of a- of Arbella Mutual Insurance Company and its three pooled insurance entities: Covenant Insurance Company (Southbury, CT), Arbella Indemnity Insurance Company, and Arbella Protection Insurance Company.
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” of Arbella Mutual Insurance Company and its three pooled insurance entities: Covenant Insurance Company (Southbury, CT), Arbella Indemnity Insurance Company, and Arbella Protection Insurance Company. These companies are collectively known as Arbella Insurance Group (Arbella). All companies are domiciled in Quincy, MA unless otherwise specified.
The ratings of Arbella reflect the group’s balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
The revised outlooks reflect Arbella’s strengthened risk-adjusted capitalization, supported by favorable trends in surplus growth and loss reserve development, as well as an enhanced reinsurance program. AM Best expects further improvement in risk-adjusted capitalization as the group continues to grow surplus through profitable operations and maintains its more robust reinsurance structure.
Additionally, the ratings reflect adequate operating performance, driven by key metrics that are relatively in line with the private passenger standard auto and homeowners composite five-year averages, inclusive of pre-tax return on revenue, combined ratio and operating ratio. The ratings also reflect Arbella’s business profile, which is considered neutral as the focused geographic concentration is partially offset by modest market share and a proven ability to effectively operate within its territories by capitalizing on enhanced data analytics and pricing schemes. Furthermore, the ERM program is appropriate for the risk profile of the organization.
This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
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