A.M. Best Revises Outlooks to Positive for Navigators Insurance Company, Its Subsidiary and The Navigators Group, Inc.

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a+” of Navigators Insurance Company and its wholly owned and 100% reinsured subsidiary, Navigators Specialty Insurance Company, collectively referred to as Navigators. Both companies are domiciled in New York, NY. Concurrently, A.M. Best has revised the outlook to positive from stable and affirmed the Long-Term ICR of “bbb+” and the Long-Term Issue Credit Rating (Long-Term IR) on $265 million 5.75% senior unsecured notes due October 2023, as well as the shelf rating of “bbb+” on senior unsecured notes, “bbb” on subordinated notes and “bbb-” on preferred securities of Navigator’s publicly traded ultimate parent, The Navigators Group, Inc. (NAVG) (Delaware) [NASDAQ:NAVG].

The revised outlooks for Navigators reflect its improved underwriting and operating performance in recent years, along with a strengthening of its risk-adjusted capitalization. The performance in core lines of business has benefited from strict underwriting discipline.

The rating affirmations reflect Navigators’ leading position as a global provider of insurance to the marine sector, the group's well-diversified book of business, its modest net windstorm exposure, management's conservative approach to risk management, underwriting and claims handling. Furthermore, the ratings consider the group's solid level of capitalization and historical profitability.

These positive rating factors are somewhat offset by the group's underwriting results in 2011 and 2012, which were not in line with the group’s overall 10-year history of profitability, and its below-average net investment yields and net investment ratios, driven by its conservative investment portfolio.

Navigators benefits from the financial and explicit support from its parent company, NAVG. NAVG’s debt-to-total capital, as of Dec. 31, 2016, is approximately 18.4% and along with its interest coverage ratios, fall within the guidelines for the current rating level.

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. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

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A.M. Best

Jonathan Harris, CFA, FRM, +1 908 439 2200, ext. 5771

Senior Financial Analyst

[email protected]

or

Jacqalene Lentz, CPA, +1 908 439 2200, ext. 5762

Director

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or

Christopher Sharkey, +1 908 439 2200, ext. 5159

Manager, Public Relations

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or

Jim Peavy, +1 908 439 2200, ext. 5644

Director, Public Relations

[email protected]

Source: A.M. Best