OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of B- (Fair) and the Long-Term Issuer Credit Rating of “bb-” of Southern General Insurance Company (SGIC) (Marietta, GA).
The Credit Ratings (ratings) reflect SGIC’s balance sheet strength, which AM Best categorizes as adequate, as well as its weak operating performance, limited business profile and marginal enterprise risk management.
The revision of the outlooks to positive reflects the improvement in operating performance in recent years that are the result of underwriting initiatives to improve rate adequacy and risk selection. Although the expense ratio remains elevated compared with the composite, it has been on a downward trend and is a contributing factor to the improved underwriting performance. Risk-adjusted capitalization remains adequate, mostly due to historically unfavorable reserve development and elevated, although improving, leverage measures. Furthermore, the company has limited scale of operations. SGIC’s business profile is limited due to its product offering and geographic concentration of risk.
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