OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” of Virginia Surety Company, Inc. (VSCI) (Chicago, IL). The outlook of these Credit Rating (ratings) remains stable.
The ratings reflect VSCI’s balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The ratings also reflect VSCI’s strategic importance to Assurant, Inc. (Assurant). From a strategic standpoint, VSCI strengthens Assurant’s position in the vehicle protection business in addition to enhancing its distribution platform. These positive rating factors are offset by the inherent credit risk associated with ceding significant portions of the business to non-rated, unauthorized captive reinsurers. The credit risk is mitigated somewhat by the use of collateral through letters of credit, trust accounts and funds held on recoverable balances.
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