AM Best Assigns Credit Ratings to Element Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)--
AM Best has assigned a Financial Strength Rating of B+ (Good) and a Long-Term Issuer Credit Rating of “bbb-” (Good) to Element Insurance Company (Element) (West Chester, OH). The outlook assigned to these Credit Ratings (ratings) is stable.

The ratings reflect Element’s balance sheet strength, which AM Best assesses as adequate, as well as its adequate operating performance, very limited business profile and appropriate enterprise risk management (ERM).

Element is a newly formed insurer focusing on commercial automobile business in Ohio. The company provides commercial auto physical damage and inland marine coverage for the trucking industry.

Element’s adequate balance sheet strength assessment is based on the company’s strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), and a conservative investment portfolio, while also acknowledging its limited financial flexibility as a privately held stock company. AM Best expects that Element will maintain supportive risk-adjusted capital levels throughout its start-up phase based on the company’s projections. AM Best assesses Element’s operating performance as adequate based on its clearly defined conservative business plan and projections that consider a level of execution risk for a newly formed entity. AM Best views Element’s business profile as very limited, given the small scale and scope of operations, as well as the significant execution risk associated with a start-up entity and the high degree of competition in the commercial auto market. AM Best considers the company’s ERM capabilities as appropriate for the scale and scope of operations, and properly aligned with its stated risk profile.

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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Source: AM Best