AM Best Affirms Credit Ratings of Ategrity Specialty Holdings LLC and Its Subsidiaries

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” (Excellent) of Ategrity Specialty Insurance Company (ASIC) and its affiliate, Ategrity Specialty Insurance Limited (ASIL). Concurrently, AM Best has affirmed the Long-Term ICR of “bbb-” (Good) of their holding company, Ategrity Specialty Holdings LLC (Ategrity). The outlook of these Credit Ratings (ratings) is stable. Ategrity and ASIC are domiciled in Wilmington, DE, USA, while ASIL is domiciled in Hamilton, Bermuda.

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

Ategrity maintains a very strong level of balance sheet strength considering the execution risk inherent in the group’s operations. The company’s risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), is at the strongest level. Ategrity has grown more than originally projected over the past few years; however, capital levels have kept pace with the increased premium and loss volume due to regular capital contributions from Ategrity’s majority owner. AM Best expects Ategrity to manage its capital closer to its strategic targets, and for the balance sheet strength to be maintained at the very strong level based on the improving operating results and the company’s capital management strategy.

Ategrity’s management was able to execute on its strategy to reduce volatility in its business and improve underwriting profitability by limiting exposure to property catastrophe lines of business, which had pressured operating earnings before 2022. Pivoting away from more volatile business and focusing on middle market commercial clients has resulted in improved underwriting results for 2023, as well as favorable net income during the past two years. The improved profitability metrics continued through the first nine months of 2024, driven by the shift in business mix coupled with rate increases. Prospective improvement of the group’s operating profitability is dependent on management’s ability to continue to execute on its business plan with a greater focus on lines of business that have less inherent volatility and more profitability. The group’s investment performance has been accretive to results as the alternative investment portfolio employed by Ategrity continues to outperform comparable benchmarks.

Ategrity, through its U.S. operating subsidiary, ASIC, began writing excess and surplus lines of business late in 2018. The group’s business profile is considered limited given its size and shifting business mix, although management has strong existing industry relationships. However, the business profile is enhanced by innovative solutions that support underwriting discipline along with management direction. The company is enhancing its ERM program, which is expected to lead to greater stability in its underwriting results.

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.

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