A.M. Best Upgrades Ratings of Echelon Property and Casualty Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best Co. has upgraded the financial strength rating (FSR) to B (Fair) from B- (Fair) and issuer credit rating (ICR) to “bb+” from “bb-” of Echelon Property and Casualty Insurance Company (Echelon) (Chicago, IL). The ratings have been removed from under review with developing implications and assigned a stable outlook.

These rating actions take into consideration the recent acquisition of Echelon by Lockhart Insurance Holdings Co., Ltd. (LIH) (U.S. Virgin Islands) and the installation of a new senior management team at Echelon. Consequently, with this acquisition, LIH made a substantial capital contribution to Echelon and has indicated its intention to support the company as management implements its re-underwriting and growth strategies. As a result, Echelon currently has adequate risk-adjusted capitalization for its ratings and benefits from the implied support of LIH.

Offsetting these factors is Echelon’s history of operating and underwriting losses since its inception in 2003, the significant surplus erosion that occurred under prior management and the execution risk under new ownership.

For Best’s Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.