AM Best Assigns Issue Credit Rating to CSAA Insurance Exchange’s New Surplus Notes

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)--
AM Best has assigned a Long-Term Issue Credit Rating of “a-” (Excellent) to the $500 million, 8.125% surplus notes, due February 2045, issued by CSAA Insurance Exchange (CSAA) (Walnut Creek, CA). The outlook assigned to this Credit Rating (rating) is negative.

The surplus notes are intended to support the company’s capital in anticipation of further premium growth and provide an additional layer of protection for catastrophic events, as well as enhance CSAA’s financial flexibility. Following the surplus notes issuance, the financial leverage at CSAA will be well within AM Best’s guidelines for the rating and the interest coverage is expected to be strong.

The notes are callable at par any time after 10 years from the issue date, in whole or in part, with 30 days prior notice and prior approval by the California Department of Insurance.

The Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” (Excellent) for the insurance operations of CSAA remain unchanged.

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.