AM Best Revises Outlooks to Positive for Synergy Comp Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of Synergy Comp Insurance Company (Synergy Comp) (Sharon, PA).

The Credit Ratings (ratings) reflect Synergy Comp’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management. The positive outlooks reflect the company’s very strong balance sheet, driven by the retention of strong operating earnings over the long term, and the expectation that organic growth in policyholder surplus will continue over the near term.

Synergy was formed in 2005 and began writing workers’ compensation in September 2006 with a focus on creating safer work environments through the reduction of the frequency and severity of workplace accidents, while utilizing employee return-to-work programs and establishing supervisor accountability.

Synergy’s risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), is assessed at the strongest level, reflective of organic surplus growth achieved through strong operating performance that benefits from sustained favorable reserve development patterns and has driven retained earnings. While Synergy’s balance sheet strength is considered very strong, the assessment considers the limited financial flexibility operating as a privately held organization.

Synergy’s operating performance is assessed as strong as evidenced by its average pre-tax return on revenue measures that have outperformed the workers’ compensation industry composite over the recent five- and 10-year timeframe. Synergy’s business profile assessment is limited as the majority of written premiums are written within Pennsylvania. As a monoline workers’ compensation insurer, its limited business profile potentially exposes the company to legislative, regulatory or judicial changes occurring within the states in which it operates. Enterprise risk management capabilities are considered appropriate given the scale, scope and complexity of the company.

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