AM Best Affirms Credit Ratings of Berkshire Hathaway GUARD Insurance Companies’ Members
25 Julio 2024 - 8:51AM
Business Wire
AM Best has affirmed the Financial Strength Rating of A+
(Superior) and the Long-Term Issuer Credit Ratings of “aa-”
(Superior) of WestGUARD Insurance Company, AmGUARD Insurance
Company, EastGUARD Insurance Company, NorGUARD Insurance Company
and AZGUARD Insurance Company (Omaha, NE), which operate under an
intercompany pooling agreement. These companies are members of
Berkshire Hathaway GUARD Insurance Companies (GUARD) and are
domiciled in Wilkes-Barre, PA, unless otherwise specified. The
outlook of these Credit Ratings (ratings) is stable.
The ratings reflect GUARD’s balance sheet strength, which AM
Best assesses as strongest, as well as its adequate operating
performance, neutral business profile and appropriate enterprise
risk management, with lift from parental support.
GUARD has maintained risk-adjusted capitalization consistently
at the strongest level, as measured by Best’s Capital Adequacy
Ratio (BCAR). The group’s overall balance sheet strength also
benefits from ample liquidity, aided by significant allocations to
cash and high-quality, short-duration fixed income investments.
Similar to other Berkshire Hathaway Inc. (Berkshire) affiliates,
GUARD also has a relatively high allocation to equity investments.
This can lead to occasional fluctuations in surplus levels during
periods of capital market volatility, but Berkshire’s investment
strategies historically have demonstrated a track record of
positive returns and capital appreciation over time. GUARD’s
overall balance sheet strength assessment also considers its uneven
loss reserve development patterns over the past several years,
which has included occasional reserve strengthening in certain
business lines outside of its core workers’ compensation product
offerings.
GUARD’s operating performance declined sharply in 2023,
following a period of several years when the group had generated
results consistently that were supportive of the adequate operating
performance assessment. GUARD’s results in 2023 included
significant underwriting losses that included the impact of
material reserve strengthening across several business lines. AM
Best notes that GUARD has made several changes to its senior
management team over the past 12 months, and that the group’s new
leadership has implemented a number of underwriting initiatives
that are intended to improve performance while refocusing the group
on its aim to be a national primary carrier for micro and small
business owners, offering one-stop-shop insurance solutions while
growing its excess & surplus market presence. AM Best expects
the company’s performance metrics to improve gradually given the
changes described above, and that its overall operating results
will return to levels that are supportive of its current ratings
over the near term.
GUARD’s ratings further recognize the implicit and explicit
financial support provided by GUARD’s immediate parent, National
Indemnity Company, a subsidiary of Berkshire, including significant
capital support via reinsurance transactions and capital
contributions.
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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240725805111/en/
Guilherme Monteiro Simoes, CFA Senior Financial
Analyst +1 908 882 2317 guy.simoes@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com
Gregory Dickerson Director +1 908 882 1737
gregory.dickerson@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com