Biglari Reinsurance has had its top-tier AM Best ratings affirmed, with the agency keeping a stable outlook on the Bermuda-based reinsurer even as the US commercial trucking market it underwrites continues to grapple with rising litigation costs and persistent underwriting losses.
The agency affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of "a+" (Excellent) on Biglari Reinsurance Ltd. and its two reinsured affiliates, First Guard Insurance Company of Scottsdale, Arizona, and Southern Pioneer Property and Casualty Insurance Company of Jonesboro, Arkansas.
The three entities, collectively known as Biglari Re, were assessed on what AM Best called very strong balance sheet strength, strong operating performance, a neutral business profile and appropriate enterprise risk management.
The balance sheet assessment rests on Biglari Re's risk-adjusted capitalization, which AM Best said sits at the strongest level on its capital adequacy measure and is expected to remain there over the near term.
Underpinning that strength is ultimate parent Biglari Holdings, a New York-listed conglomerate. The group's holdings span the Steak 'n Shake restaurant chain, Maxim magazine, Western Sizzlin and oil and gas interests, alongside its insurance operations.
Biglari Holdings reported shareholders' equity of US$580 million at the end of September 2025, with investment holdings of US$748 million, including positions managed through its in-house investment vehicle, The Lion Fund.
Biglari Re reinsures First Guard and Southern Pioneer through whole-account quota share treaties covering all property and casualty lines written by the two carriers. First Guard, acquired by the group in 2014, is a direct-to-trucker commercial truck insurer focused on physical damage and non-trucking liability cover for owner-operators and small fleets.
Southern Pioneer, brought into the fold in 2020, is a longer-established Arkansas carrier that, in figures dating back to 2015, had grown its written premium to more than US$24 million from a standing start in 1981.
The underwriting environment, particularly for First Guard's book, remains testing. Research cited by trucking publication Land Line and produced by the American Transportation Research Institute found auto liability premiums had climbed nearly 38% per mile over the past decade.
The American Trucking Associations has pointed to third-party litigation finance, a sector it estimates at about US$400 billion globally, as a key driver of plaintiff-friendly verdicts. Industry data show commercial auto liability has been unprofitable for insurers for 14 consecutive years.
There are mitigating features, however. Auto physical damage cover, which sits at the heart of First Guard's offering, has been profitable in five of the past six years, suggesting Biglari Re is less exposed to liability-led verdict shock than peers concentrated in trucking liability lines.
AM Best said investment returns are low under current allocation choices but noted the reinsurer does not rely on investment income for profitability, with the assumed business showing steady revenue growth and consistently positive operating metrics.
