AM Best Affirms Credit Ratings of Members of Spinnaker Insurance Group

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of Spinnaker Insurance Company and its 100% reinsured subsidiaries, Spinnaker Specialty Insurance Company and Wingsail Insurance Company. Concurrently, AM Best has affirmed the Long-Term Issue Credit Rating of “bbb” (Good) on the $50 million, 9.5% surplus notes, due in 2040, issued by Spinnaker Insurance Company. The outlook of these Credit Ratings (ratings) is stable. All companies are headquartered in Bedminster, NJ, and collectively referred to as Spinnaker Insurance Group (Spinnaker).

The ratings reflect Spinnaker’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.

Spinnaker’s very strong balance sheet strength assessment is supported by its strongest level of risk-adjusted capitalization, as measured by Best’s Credit Adequacy Ratio (BCAR). Spinnaker's publicly traded parent, Hippo Holdings Inc. (Hippo) [NYSE: HIPO], has demonstrated capital support to Spinnaker since acquiring it in August 2020. Spinnaker’s surplus growth in the last five years was driven by a mix of capital contributions from Hippo, retained earnings, and the issuance of USD 50 million in unaffiliated surplus notes in 2025. Spinnaker’s balance sheet strength assessment considers the conservative participation that the group maintains on select program business, supported by a comprehensive reinsurance program comprised of high quality reinsurers. Spinnaker maintains a conservative investment portfolio comprised primarily of long-term bonds and short-term investment holdings. The ratings further reflect the financial flexibility and operational benefits afforded by Hippo. However, should Hippo’s financial trends not improve as expected, Spinnaker’s ratings could be negatively impacted.

Spinnaker maintains an adequate operating performance assessment. Despite variability in reported earnings over the recent five-year period, viewed over the long term, Spinnaker has reported solid pre-tax operating earnings, which have generally outperformed the personal property industry composite. Gross premium written has continued to grow each year since Spinnaker’s inception, as the group expands and diversifies its portfolio of programs. Spinnaker’s operating performance has been driven by generally profitable underwriting performance, augmented by investment income and fee-based income. Spinnaker’s growth in pre-tax income over the long term has been achieved despite the impact of catastrophe losses, excess of loss reinsurance costs and ongoing investments in operations (people and infrastructure) to support future growth.

Spinnaker’s limited business profile assessment reflects the group’s conservative approach to writing business, whereby it generally cedes a majority of premiums on a program-by-program basis to quota share reinsurers. Business is sourced from program administrators and managing general agents with substantial reinsurance protection, primarily structured as fronting arrangements. Spinnaker focuses on short-tail programs, including homeowners and renters’ insurance, as well as other specialty lines. The strategic partnership announced in 2025 between Hippo and The Baldwin Group Inc. [NASDAQ: BWIN] is expected to further expand and diversify Spinnaker’s underwriting portfolio.

The stable outlooks reflect AM Best’s expectation that Spinnaker’s operating performance will remain profitable and that its balance sheet strength will remain supportive of the current rating level.

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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