OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has upgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “a+” from “a” and affirmed the Financial Strength Rating (FSR) of A (Excellent) of Haulers Insurance Company, Inc. (Haulers). A.M. Best also has affirmed the FSR of A (Excellent) and the Long-Term ICRs of “a+” of the other members of Shelter Insurance Companies (the group): Shelter Mutual Insurance Company (Shelter Mutual), Shelter General Insurance Company, Shelter Reinsurance Company and AmShield Insurance Company. Concurrently, A.M. Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “a+” of Shelter Life Insurance Company (Shelter Life), which is a wholly owned subsidiary of Shelter Mutual. The outlook of these Credit Ratings (rating) is stable. All companies are domiciled in Columbia, MO other than Haulers, which is domiciled in Columbia, TN.
The upgrade of Hauler’s Long-Term ICR is based on the company’s growing integration and strategic role within the group, which warrants full rating enhancement. Haulers has strategically utilized the independent distribution channel to allow the group to gain valuable experience beyond exclusive agents. Furthermore, the company recently entered into a stop-loss agreement with its parent, Shelter Mutual, which provides explicit support to guard against volatile operating results. Finally, management plans to further integrate and align Haulers’ operations to strengthen the book’s position.
The group’s ratings reflect its balance sheet strength, which A.M. Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
The group’s balance sheet strength assessment is supported by the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), low underwriting leverage compared with the private passenger standard auto and homeowners composite, as well as consistently favorable loss reserve development. Operating performance has been marked by underwriting volatility over the past five years, which has been offset largely by material net investment income. The group’s business profile continues to develop with the addition of a new distribution channel and state expansion. Geographically, the group operates in a number of states, with considerable concentrations in three states.
The ratings of Shelter Life reflect its balance sheet strength, which A.M. Best categorizes as very strong, as well as its adequate operating performance, neutral business profile and appropriate ERM. The ratings of Shelter Life also reflect its strategic role as a subsidiary of Shelter Mutual. The entity focuses on traditional life insurance products distributed through an exclusive agency force. Shelter Life benefits from its degree of integration within the group, as well as brand recognition and crossing-selling opportunities afforded thereon.
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