OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has upgraded the Financial Strength Rating to B++ (Good) from B+ (Good) and the Long-Term Issuer Credit Rating to “bbb” from “bbb-” of Repwest Insurance Company (Repwest) (Phoenix, AZ). The outlook of the Long-Term ICR has been revised to positive from stable while the outlook of the FSR remains stable. Repwest is a wholly owned subsidiary of AMERCO [NASDAQ: UHAL], a publicly traded holding company that is also the parent of U-Haul International, Inc. (U-Haul).
The rating upgrades reflect Repwest’s strong risk-adjusted capitalization, several years of improved operating results and A.M. Best’s expectation of stabilized underwriting performance prospectively. The expectation of improved future performance reflects the favorable results of the group’s core business, which has produced a five-year average pure loss ratio that outperforms its industry composite’s average. The company has had no adverse loss reserve development since 2011.
Offsetting these positive rating factors is the company’s historically high-cost structure, mainly driven by commission expense.
Future positive rating movement could result from a demonstration of stabilized underwriting results over several consecutive years. Negative rating actions could result if there is deterioration in Repwest’s underwriting performance or a significant erosion of its capital base.
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