OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has commented that the Credit Ratings (ratings) of Health Care Service Corporation, a Mutual Legal Reserve Company (HCSC) (Chicago, IL) remain unchanged following the announcement that CEO Paula Steiner is stepping down from her position immediately. AM Best notes that HCSC continues to maintain the strongest level of risk-adjusted capitalization. AM Best evaluates an organization’s management quality and stability as part of the business profile assessment and this event raises some concern. However, HCSC’s leading market position in all of its core territories, including Texas and Illinois, as well as its good level of product diversification, remain sufficient to support the business profile assessment of favorable. HCSC’s operating performance, which is currently evaluated as marginal, has exhibited positive trends over the past two years.
While this recent management change has not resulted in a rating action, AM Best is concerned that unexpected leadership transition may compromise the organization’s strategic direction in the near term. AM Best will continue to have discussions with HCSC management and monitor the organization’s performance.
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