AM Best Downgrades Issuer Credit Rating of Members of Auto Club Enterprises Group; Removes From Under Review With Positive Implications, Upgrades Credit Ratings of Wawanesa General Insurance Company
25 Abril 2024 - 11:27AM
Business Wire
AM Best has downgraded the Long-Term Issuer Credit
Ratings (Long-Term ICR) to “aa-” (Superior) from “aa” (Superior)
and affirmed the Financial Strength Rating (FSR) of A+ (Superior)
of members of Auto Club Enterprises Insurance Group (ACE)
(headquartered in Costa Mesa, Ca). The outlook of the Long-Term
ICRs has been revised to stable from negative while the outlook of
the FSR is stable. Concurrently, AM Best has removed from under
review with positive implications and upgraded the FSR to A+
(Superior) from C++ (Marginal) and the Long-Term ICR to “aa-”
(Superior) from “b+” (Marginal) of Wawanesa General Insurance
Company (Wawanesa General) (San Diego, CA) a newly added reinsured
subsidiary of ACE. The outlook assigned to these Credit Ratings
(ratings) is stable. See below for a detailed list of
companies.
The ratings reflect ACE’s balance sheet strength, which AM Best
assesses as strongest, as well as its adequate operating
performance, favorable business profile, and appropriate enterprise
risk management.
The Long-Term ICR downgrade considers ACE’s earnings
deterioration in the last two years, primarily due to rising claims
frequency, increased claims costs and significant weather-related
property losses in Midwestern states. While ACE’s operating results
have outperformed its private passenger auto and homeowners
composite peers for many years, 2022 and 2023 proved to be
challenging for the group, similar to many of its industry peers.
Consequently, the group’s assessment for its operating performance
was revised to adequate from strong. AM Best notes that ACE has
implemented detailed strategic initiatives to restore underwriting
profitability, which include rate changes, increased deductibles
and refined claims management. AM Best expects the group’s earnings
to continue improving gradually in 2024.
The FSR of A+ (Superior) has been affirmed while the Long-Term
ICR has been downgraded to “aa-” (Superior) from “aa” (Superior),
with the outlook of the FSR remaining stable and the outlook of the
Long-Term ICRs revised to stable from negative for the following
members of Auto Club Enterprises Insurance Group:
- Auto Club Casualty Company
- Auto Club County Mutual Insurance Company
- Auto Club Family Insurance Company
- Auto Club Indemnity Company
- Automobile Club Inter-Insurance Exchange
- Interinsurance Exchange of the Auto Club
- Motor Club Insurance Company
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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Thomas Keelan Financial Analyst +1 908 882 1925
thomas.keelan@ambest.com Michael T. Venezia Senior Financial
Analyst +1 908 882 1903 michael.venezia@ambest.com
Christopher Sharkey Associate Director, Public Relations +1 908
882 2310 christopher.sharkey@ambest.com Al Slavin Senior
Public Relations Specialist +1 908 882 2318
al.slavin@ambest.com