A.M. Best Revises Outlook to Positive for Eastern Dentists Insurance Company, A Risk Retention Group

OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best Co. has revised the outlook to positive from stable and affirmed the financial strength rating of B+ (Good) and issuer credit rating of “bbb-” of Eastern Dentists Insurance Company, A Risk Retention Group (EDIC) (Burlington, VT).

The ratings of EDIC reflect its supportive risk-adjusted capitalization and favorable operating performance, enhanced by non-risk bearing income generated by its subsidiaries. Partially offsetting these favorable rating factors are the company’s potential exposure to multiple claims from a single insured, though this has been mitigated somewhat by reinsurance as noted below, its concentration risks related to being a monoline writer of dental professional liability insurance and its somewhat low geographic distribution. EDIC also operates with a high expense structure explained by the lower dental premium rates relative to other professional liability specialty insurers.

The outlook reflects EDIC’s improved level of capitalization and contemplates the company’s sustainability of risk-adjusted capitalization and profitability over the near term. EDIC is the leader in providing professional liability coverage to dentists in Massachusetts and writes business across the northeastern United States. The company maintains large aggregate policy limits up to $6 million, although reinsurance is in place that provides coverage in excess of retained limits. EDIC recently improved its reinsurance structure to protect future earnings and overall capitalization from the impact of aggregate loss accumulation on a single insured basis.

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