AM Best Assigns Preliminary Credit Assessment to Victor Insurance Exchange

OLDWICK, N.J.--(BUSINESS WIRE)--
AM Best has assigned a Preliminary Credit Assessment (PCA) to Victor Insurance Exchange (Wilmington, DE) with a Financial Strength Assessment of A- pca (Excellent) and a Long-Term Issuer Credit Assessment of “a-” pca (Excellent). The outlook assigned to this PCA is stable.

The PCA reflects Victor Insurance Exchange’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The very strong balance sheet strength assessment reflects Victor Insurance Exchange’s strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR) on a proforma basis for an expected initial capitalization via a surplus note funded by Gallatin Point Capital. AM Best expects Victor Insurance Exchange’s risk-adjusted capitalization to remain within the strongest category with additional positive assessment factors contributing, including a low-risk conservative investment portfolio and comprehensive reinsurance programs with a diversified panel of participants. Partially offsetting these strengths is Victor Insurance Exchange’s high financial leverage due to the surplus note, exposure to catastrophe losses and expected modest reliance on reinsurance given its risk profile.

AM Best assesses Victor Insurance Exchange’s operating performance as adequate based on the company’s projections and the fact that the anticipated writings and associated historical loss ratios are well known to the company via the exclusive managing general agent, ICAT. AM Best views Victor Insurance Exchange’s business profile as neutral given ICAT’s demonstrated extensive industry experience in managing the business through various underwriting cycles. Victor Insurance Exchange will be a geographically diversified writer of small to medium-sized commercial risks as well as coastal residential properties with products distributed through ICAT’s existing network of wholesale and retail brokers. While there is execution risk in implementing Victor Insurance Exchange’s business plan, this is tempered by the demonstrated track record and available resources provided via both the financial sponsor, Gallatin Point Capital and strategic sponsor, Marsh McClennan. Lastly, Victor Insurance Exchange’s ERM capabilities are anticipated to benefit from the overall framework developed and utilized by ICAT.

This press release relates to Preliminary Credit Assessments that have been published on AM Best’s website. For all assessment information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual assessments 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 and Assessment 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 © 2023 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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Brian O’Larte

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Richard Attanasio
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Christopher Sharkey
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Al Slavin
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Source: AM Best