AM Best Assigns Credit Ratings to Transverse Specialty Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has assigned a Financial Strength Rating (FSR) of A- (Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” to Transverse Specialty Insurance Company (Transverse Specialty) (Wilmington, DE). The outlook assigned to these Credit Ratings (ratings) is stable. Concurrently, AM Best has affirmed the FSR of A- (Excellent) and the Long-Term ICR of “a-” of Transverse Insurance Company (Transverse Insurance) (Dallas, TX). The outlook of these ratings remains stable. Transverse Specialty and Transverse Insurance are collectively referred to as Transverse Insurance Group.

The ratings reflect Transverse Insurance Group’s balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).

The balance sheet assessment of very strong is based on initial financing capacity that meets AM Best’s guidelines for newly formed companies and provides supportive risk-adjusted capital levels through a five-year startup period. Expected capital levels are measured against reinsurance recoverable amounts, including credit risk and reinsurance dependence factors. AM Best assesses Transverse Insurance Group’s operating performance as adequate based on the group’s clearly defined business plan that contemplates a level of implementation and execution risk for a newly formed entity. AM Best views the group’s business profile as limited, as it will serve as a hybrid fronting/transformer carrier, and will require a period to establish its brand and market position. A clearly defined ERM structure includes risk appetite and tolerance statements that focus on concerns specific with the business profile. Risk management benefits from an experienced management team cognizant of the key elements in their chosen niche.

Negative rating actions could occur with declines in risk-adjusted capital, actual results falling adversely outside the initial projections, the enterprise being unable to gain traction within the parameters of its business profile, or risk appetite and tolerance levels proving to be inadequate for the organization's profile.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

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