Ratings agency A.M. Best has adjusted the issuer credit rating of a Louisiana based property/casualty insurance group.
Amerisafe Inc. subsidiaries American Interstate Company, Silver Oak Casualty and American Interstate Insurance Company of Texas all had their credit rating outlook improved from positive to stable. The agency also affirmed the financial strength rating of the subsidiaries as an A (Excellent).
A.M. Best also revised the outlook of Amerisafe to positive from stable and affirmed the issuer credit rating of ‘bbb.’
The ratings reflect Amerisafe’s risk-adjusted capitalization – considered “sound” by A.M. Best – as well as its profitable operating performance and status as a market leader in workers’ compensation for high hazard risks.
“Driven by solid underwriting results, Amerisafe produces operating results that continue to outperform its peer composite average over the long term,” the ratings agency said. “Management’s adherence to prudent underwriting practices and pricing discipline, consistent reserving practices that have resulted in favorable calendar-year loss reserve development trends, focused loss control and safety programs and active claims management are the basis for the favorable underwriting results.
Despite the positive developments, A.M. Best did note Amerisafe’s product concentration and earnings volatility marred ratings somewhat. These resulted from “adverse development of several accident years.”
However, the group expects operating results to remain strong for the carrier, as well as continued solid capitalization.
“Overall, the ratings outlook recognizes A.M. Best’s expectation that Amerisafe’s improvement in underwriting and operating results will continue over the near term, ad capitalization will remain well supportive of the ratings,” a press release on the development said.
