OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” (Excellent) to Victor Insurance Exchange (Wilmington, DE). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect Victor Insurance Exchange’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
The very strong balance sheet strength assessment reflects Victor Insurance Exchange’s strongest risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR) reflecting initial capitalization via a surplus note funded by its financial sponsor, Gallatin Point Capital. AM Best expects Victor Insurance Exchange’s risk-adjusted capitalization to remain within the strongest category with additional positive assessment factors contributing, including a low-risk conservative investment portfolio and comprehensive reinsurance programs with a diversified panel of participants. Partially offsetting these strengths is Victor Insurance Exchange’s high financial leverage due to initial capitalization via a surplus note, exposure to catastrophe losses and modest reliance on reinsurance given its risk profile.
AM Best assesses Victor Insurance Exchange’s operating performance as adequate based on its projections and the fact that anticipated writings and associated historical loss ratios are well known to the company via its exclusive managing general agent, ICAT. AM Best views Victor Insurance Exchange’s business profile as neutral given ICAT’s demonstrated extensive industry experience in managing the business through various underwriting cycles. Victor Insurance Exchange will be a geographically diversified writer of small to medium-sized commercial risks, as well as coastal residential properties with products distributed through ICAT’s existing network of wholesale and retail brokers. While there is execution risk in implementing the company’s business plan, this is tempered by its demonstrated track record and available resources provided via both Gallatin Point Capital and its strategic sponsor, Marsh McLennan. Victor Insurance Exchange’s ERM capabilities are anticipated to benefit from the overall framework developed and utilized by ICAT.
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