OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of American Capital Assurance Corp (ACAC) (St. Petersburg, FL).
The negative outlooks reflect AM Best’s concerns with the recent decline in operating performance, stemming from an increase in weather-related losses.
The Credit Ratings (ratings) reflect ACAC’s balance sheet strength, which AM Best categorizes as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management. The ratings consider ACAC’s strongest level of risk-adjusted capitalization, consistently redundant reserving practices, comprehensive catastrophe reinsurance program, and historically favorable return measures. Offsetting these positive rating factors is a weather and catastrophe-exposed book of business that can lead to volatility in underwriting results, as evidenced over the past two years. Management is well-seasoned and experienced in this niche and is implementing measures in an effort to return to operating profitability.
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