OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlook to positive from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of A (Excellent) and Long-Term ICR of “a” of the insurance entities of HAI Group. The outlook of the FSR remains stable. (See below for a detailed listing of the entities.)
The ratings reflect HAI Group’s balance sheet strength, which AM Best categorizes as strongest, as well as its marginal operating performance, favorable business profile and appropriate enterprise risk management (ERM).
The revision in the Long-Term ICR outlook to positive is based on HAI Group’s improved operating performance in recent years, driven primarily by favorable loss experience and deliberate expense management, which has led to a return to profitability and surplus growth. The favorable earnings trend is attributed mainly to strong senior leadership, improved underwriting, stricter underwriting and claims handling, stringent risk management practices and favorable reserve development. In addition, HAI Group’s pre-tax return measures exceed the industry.
The ratings also recognize HAI Group’s strongest level of risk-adjusted capitalization, strong liquidity, conservative investment portfolio, and comprehensive reinsurance program that protects policyholder surplus from volatility in results. The group’s business profile continues to be favorable with a positive niche market position, as well as good geographic and product spread of risk as a family of companies that serves the public and affordable housing community with insurance programs designed specifically for this segment of the housing market. ERM continues to be appropriate as the group expands risk management practices to mitigate risks to its members.
The positive Long-Term ICR outlook also reflects AM Best's expectation that HAI Group’s operating performance will continue its upward trajectory while maintaining its balance sheet strength assessment level of strongest and favorable niche business profile without divergence from its risk profile in the near term.
The FSR of A (Excellent) and the Long-Term ICRs of “a” have been affirmed, with the Long-Term ICR outlook revised to positive from stable and the FSR outlook maintained at stable for the insurance entities of HAI Group:
- Housing Authority Property Insurance, A Mutual Company
- Housing Authority Risk Retention Group, Inc.
- Housing Enterprise Insurance Company, Inc.
- Housing Specialty Insurance Company, Inc.
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