A.M. Best Affirms Ratings of National General Holdings Corp. and its Subsidiaries
The rating affirmations of National General Group’s members reflect their supportive level of risk-adjusted capitalization, the group’s generally profitable operating performance, its well-diversified and substantial business profile in the personal lines market and its scalable operating platform, which has enabled the group to substantially increase its premiums in recent years without similar increases in underwriting expenses. The ratings also consider the financial flexibility of NGHC, as demonstrated by a series of capital raises in recent years. While these capital raises have been used primarily to fund acquisitions, they have also been used to increase the surplus of the
The positive rating factors are partially offset by variability in the group’s statutory underwriting and operating performance, although concern with respect to this variability is somewhat offset by the group’s generation of fee income. The group has an increasing exposure to weather-related losses as it expands its homeowners business, although the group’s strong reinsurance program somewhat mitigates this concern.
The rating affirmations of
The rating affirmations of Century-Nation reflect the company’s strong level of risk-adjusted capitalization, sound liquidity and management’s extensive knowledge of its local marketplace. These positive factors are partially offset by the company’s recent underwriting volatility and geographic concentration of risk.
The ICR of NGHC and its associated issue and indicative issue ratings reflect the company’s financial leverage, with adjusted debt to total capital (less accumulated other comprehensive income) measuring 29.1% at
Positive movement in the ratings is not likely in the near-term, but could occur should sustained improvement in underwriting and operating performance reach a level that exceeds the composite average over the longer-term. Negative rating actions could result from deterioration in underwriting or operating performance to a level that is materially lower than that of its similarly-rated peers. A substantial change in the financial condition of NGHC could also impact the ratings, which could be positive or negative based on the direction of the holding company results.
The FSR of A- (Excellent) and the ICRs of “a-” have been affirmed for the following insurance subsidiaries of
-
New South Insurance Company -
National General Assurance Company -
Integon National Insurance Company -
Integon Indemnity Corporation -
Integon General Insurance Corporation -
MIC General Insurance Corporation - National General Insurance Company
-
National Health Insurance Company -
Integon Casualty Insurance Company -
Imperial Fire and Casualty Insurance Company -
Integon Preferred Insurance Company -
National General Insurance Online Inc. -
Personal Express Insurance Company -
National General Re Ltd. -
Century-National Insurance Company - Agent Alliance Insurance Company
The following issue ratings have been affirmed:
National General Holdings Corp.—
-- “bbb-” on
-- “bbb-” on
-- “bb+” on
-- “bb” on
-- “bb” on
-- “bb” on
The following indicative issue ratings have been affirmed:
-- “bbb-” on senior unsecured debt
-- “bb+” on subordinated debt
-- “bb” on preferred stock
-- “bb” on junior subordinated debt
This press release relates to rating(s) that have been published on A.M. 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 A.M. Best’s Recent Rating Activity web page.
Copyright © 2016 by A.M. Best Rating Services, Inc. ALL RIGHTS RESERVED.
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