A.M. Best Affirms Ratings of CRM Holdings, Ltd. and Its Subsidiaries
12 Agosto 2009 - 9:34AM
Business Wire
A.M. Best Co. has affirmed the financial strength rating
(FSR) of A- (Excellent) and issuer credit rating (ICR) of “a-” of
Majestic Insurance Company (Majestic) (San Francisco, CA).
Additionally, A.M. Best has affirmed the FSR of B++ (Good) and ICR
of “bbb” of Twin Bridges (Bermuda) Ltd. (Twin Bridges)
(Hamilton, Bermuda). Both companies are subsidiaries of CRM
Holdings, Ltd. (CRM Holdings) (Hamilton, Bermuda) (NASDAQ:
CRMH).
A.M. Best also has affirmed the ICRs of “bbb-” of CRM Holdings,
Embarcadero Insurance Holdings, Inc. (Embarcadero) (San
Francisco, CA) and CRM USA Holdings, Inc. (CRM USA)
(Wilmington, DE). Concurrently, A.M. Best has affirmed the debt
ratings of “bb” on the trust preferred securities of CRM USA and
the surplus notes of Embarcadero. The outlook for all ratings is
negative. (See below for a detailed listing of the debt
ratings.)
The ratings of Majestic reflect its solid capitalization,
profitable operating results, stabilization of its loss reserves
and its expertise within its specialty workers’ compensation
markets.
Offsetting these strengths is the adverse loss reserve
development reported in Majestic’s earlier years, a recent shift in
the company’s book of business to smaller risks and new geographic
areas, the reduced financial flexibility of CRM Holdings, as well
as some concern over Majestic’s ability to meet performance
projections while maintaining prudent capitalization levels.
The ratings of Twin Bridges recognize its solid capitalization,
favorable underwriting and operating performance to date and
management’s experience in the excess workers’ compensation
reinsurance market for self-insured groups.
Offsetting these strengths is the significant decline in Twin
Bridges’ overall capitalization following management’s decision to
reallocate capital within the overall CRM group, the relative
immaturity of the company’s loss reserves and the concentration in
a single line business.
The following debt ratings have been affirmed:
CRM USA Holdings, Inc.—
-- “bb” on $35 million 8.65% junior subordinated debt
securities, due 2036
Embarcadero Insurance Holdings, Inc.—
-- “bb” on $8 million LIBOR+ 4.2% surplus notes, due 2033
For Best’s Credit Ratings, an overview of the rating process and
rating methodologies, please visit www.ambest.com/ratings.
The principal methodologies used in determining these ratings,
including any additional methodologies and factors that may have
been considered, can be found at
www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is a global full-service
credit rating organization dedicated to serving the financial and
health care service industries, including insurance companies,
banks, hospitals and health care system providers. For more
information, visit www.ambest.com.
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