OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has upgraded the issuer credit rating to “bb+” from “bb” and affirmed the financial strength rating of B (Fair) of Nationwide Insurance Company of Florida (NICOF) (Columbus, OH). The outlook for both ratings has been revised to positive from stable.
The ratings and outlook for NICOF reflect its solid risk-adjusted capitalization and improved operating performance over the past year. Through numerous risk management initiatives, NICOF has significantly reduced its exposures and concentrations of risk in Florida in recent years. NICOF also benefits from implicit and explicit support from its parent, Nationwide Mutual Insurance Company, through platforms and processes such as catastrophe reinsurance coverage, enterprise risk management and common infrastructure and distribution channels.
Partially offsetting these positive rating factors is the company’s limited business profile as a single-state, single-product writer. This leaves NICOF subject to potential adverse regulatory and judicial decisions, as well as economic conditions. In addition, as a Florida writer, the company will always be at risk of catastrophic weather events.
Regarding future rating movement, a longer term profitable trend in underwriting performance and continued strong risk adjusted capitalization could lead to a further upgrading of the ratings. Conversely, any deterioration in operating performance could result in negative rating pressure.
The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
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