The ratings of NORCAL reflect the group’s supportive balance sheet strength, as evidenced by its strong risk-adjusted capitalization, sound liquidity and low underwriting leverage, and historically profitable operating performance. In addition, the group’s reserves have been redundant year after year. The ratings also recognize NORCAL’s proactive risk management and leadership position as one of the largest providers of medical professional liability (MPL) insurance in
The rating outlooks are negative due to erosion of underwriting performance, primarily in 2013 and 2014, and a steady decline in written premium. This has raised concerns about future performance as the group’s underwriting is concentrated in MPL lines, which are experiencing a soft market pricing and changing market dynamics.
The ratings of PPM RRG have been removed from under review with negative implications and the risk retention group (RRG) has been assigned the ratings of
The acquisition of PPM RRG is viewed positively by
The FSR of A (Excellent) and the Long-Term ICRs of “a” have been affirmed for following members of the
NORCAL Mutual Insurance Company
NORCAL Specialty Insurance Company
Medicus Insurance Company
FD Insurance Company
The FSR of A (Excellent) and the Long-Term ICR of “a” has been removed from under review and affirmed for the following member of the
Preferred Physicians Medical Risk Retention Group, a Mutual Insurance Company
This press release relates to Credit Ratings 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. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
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