AM Best Upgrades Credit Ratings of EmblemHealth, Inc.’s Subsidiaries

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has upgraded the Financial Strength Rating to C+ (Marginal) from C (Weak) and the Long-Term Issuer Credit Ratings to “b-” (Marginal) from “ccc” (Weak) of Health Insurance Plan of Greater New York, EmblemHealth Insurance Company and EmblemHealth Plan, Inc., collectively referred to as Emblem. All companies are subsidiaries of EmblemHealth, Inc. and domiciled in New York, NY. The outlook of these Credit Ratings (ratings) has been revised to positive from stable.

The ratings reflect Emblem’s balance sheet strength, which AM Best assesses as very weak, as well as its marginal operating performance, neutral business profile and marginal enterprise risk management (ERM).

Emblem’s balance sheet strength assessment of very weak is mostly driven by its risk-adjusted capitalization, which is assessed as weak, as measured by Best's Capital Adequacy Ratio (BCAR). Following a trend of capital declines, Emblem’s absolute capital and surplus began to trend upward at the end of 2024, driven by unrealized capital gains that had offset operating losses. The upward trend continued through 2025, as Emblem reported further improvement in its capital and surplus driven by proceeds from the sale of ConnectiCare, Inc. and considerable improvement in underwriting and investment income. Emblem’s investment portfolio is conservatively positioned with a focus on high-grade fixed income. The company also maintains high levels of cash and short-term investments for added liquidity. As a result of the marked capital improvements, Health Insurance Plan of Greater New York, the lead operating entity, was able to conclude its capital restoration plan with the New York State Department of Financial Services in 2025, ahead of schedule.

Prior to 2025, Emblem experienced a trend of net and underwriting losses. As a result of multiple strategic changes, Emblem has reported positive operating and net earnings in the past five consecutive quarters through the first quarter of 2026, reporting a five-year high in both operating and net income for year-end 2025. This is being driven by markedly improved underwriting results predominantly for the Medicare Advantage and Medicaid lines of business, as well as a materially higher level of investment income. Invested assets have grown significantly in the past two years, with a higher allocation to bonds, producing a trend of increasing investment income. The positive outlook reflects the near-term improvement in operating results.

Emblem maintains a solid market position in the greater New York City market with a long-standing presence there that spans 85 years. Additionally, the organization derives a large portion of its membership from union and labor accounts, anchored by the City of New York account.

Emblem has a fully developed ERM program with established risk appetite statements and a good governance structure. AM Best recognizes that the improved ERM program was integral in completing the capital restoration plan and improvement in operating results.

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