AM Best Places Credit Ratings of Casualty Underwriters Insurance Company Under Review With Negative Implications

OLDWICK, N.J.--()--AM Best has placed under review with negative implications the Financial Strength Rating of C++ (Marginal) and the Long-Term Issuer Credit Rating of “b” (Marginal) of Casualty Underwriters Insurance Company (CUIC) (Salt Lake City, UT).

The Credit Ratings (ratings) have been placed under review with negative implications given deterioration in CUIC’s overall level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as its rising leverage measures and continued erosion in policyholders’ surplus. Key balance sheet strength metrics have weakened primarily due to CUIC significantly expanding its business and overall risk exposure in several new states such as Oklahoma, Kansas, North Dakota and Idaho over the past few years and particularly through 2023.

In response, management intends to execute one or more capital management strategies that are aimed at reducing CUIC’s share of the risk exposure and strengthening its capital position. AM Best expects that these actions, if successfully implemented, could potentially improve the current leverage position. The ratings will remain under review until the impact of these initiatives on the company’s rating fundamentals can be appropriately analyzed. Failure to execute or pursue these strategies as anticipated could lead to rating downgrades.

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 use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2024 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Contacts

Lauren Magro
Financial Analyst
+1 908 882 2082
lauren.magro@ambest.com

Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
christopher.sharkey@ambest.com

Janet Hernandez
Senior Financial Analyst
+1 908 882 1890
janet.hernandez@ambest.com

Al Slavin
Senior Public Relations Specialist
+1 908 882 2318
al.slavin@ambest.com

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Contacts

Lauren Magro
Financial Analyst
+1 908 882 2082
lauren.magro@ambest.com

Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
christopher.sharkey@ambest.com

Janet Hernandez
Senior Financial Analyst
+1 908 882 1890
janet.hernandez@ambest.com

Al Slavin
Senior Public Relations Specialist
+1 908 882 2318
al.slavin@ambest.com