A.M. Best Assigns Credit Ratings to Auto-Owners Specialty Insurance Company

OLDWICK, N.J.--()--A.M. Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” to Auto-Owners Specialty Insurance Company (AOSIC) (Dover, DE). The outlook assigned to these Credit Ratings (ratings) is stable.

These ratings reflect AOSIC’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its adequate operating performance, very limited business profile and appropriate enterprise risk management.

AOSIC is a shell company that plans to provide excess and surplus lines coverage to small and medium-size commercial businesses in North Carolina. Risk-adjusted capitalization is supportive of its business plan, which includes moderate premium growth projections. In addition, the company is led by a management team with a track record of generating favorable operating results at its sister company, Atlantic Casualty Insurance Company (Atlantic Casualty), and possessing extensive knowledge of the surplus lines commercial property/casualty business. These positive rating factors are offset partially by the expected concentration of non-admitted business in one state.

The ratings further reflect the benefits AOSIC receives from being owned by Auto-Owners Insurance Company (Auto-Owners), domiciled in Lansing, MI, which is a much larger, strongly capitalized insurance organization. Auto-Owners completed the acquisition of AOSIC, formerly Little River Insurance Company, and Atlantic Casualty on Jan. 1, 2016.

The outlooks reflect management’s near term projections, which call for modest operating profits, as well as the expectation that management will operate in a manner that is consistent with the business plan presented to A.M. Best.

Negative rating actions could occur if underwriting or operating performance falls significantly below A.M. Best’s expectations or if risk-adjusted capitalization deteriorates significantly from expected levels. AOSIC’s ratings also may be impacted negatively if its relationship to Auto-Owners and its support change in a manner that no longer warrants rating enhancement.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Contacts

A.M. Best
Robert Valenta, +1 908 439 2200, ext. 5291
Senior Financial Analyst
robert.valenta@ambest.com
or
Christopher Sharkey, +1 908 439 2200, ext. 5159
Manager, Public Relations
christopher.sharkey@ambest.com
or
Raymond Thomson, CPCU, ARe, ARM, +1 908 439 2200, ext. 5621
Associate Director
raymond.thomson@ambest.com
or
Jim Peavy, +1 908 439 2200, ext. 5644
Director, Public Relations
james.peavy@ambest.com

Contacts

A.M. Best
Robert Valenta, +1 908 439 2200, ext. 5291
Senior Financial Analyst
robert.valenta@ambest.com
or
Christopher Sharkey, +1 908 439 2200, ext. 5159
Manager, Public Relations
christopher.sharkey@ambest.com
or
Raymond Thomson, CPCU, ARe, ARM, +1 908 439 2200, ext. 5621
Associate Director
raymond.thomson@ambest.com
or
Jim Peavy, +1 908 439 2200, ext. 5644
Director, Public Relations
james.peavy@ambest.com