AM Best Revises Outlooks to Positive for Definity Financial Corporation and Its Subsidiary

OLDWICK, N.J.--(BUSINESS WIRE)--
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term ICR of “a-” (Excellent) of Definity Insurance Company (Definity Insurance). Concurrently, AM Best has revised the outlooks to positive from stable and affirmed the Long-Term ICR of “bbb-” (Good) of Definity Financial Corporation. Both companies collectively are known as Definity and are domiciled in Ontario, Canada.

The Credit Ratings (ratings) of Definity Insurance reflect its balance sheet strength, which AM Best assesses as very strong, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management.

The revision of Definity’s outlooks to positive reflects recent improvements in underwriting results as the company completes upfront investments related to the expansion of its brands in personal lines and digital investments in technology and analytics, which are contributing to better risk selection and claims practices. The outlook change reflects favorable improvement in underwriting performance within personal and commercial lines over the last three years.

The positive outlooks further recognize AM Best’s expectation that the company's operating performance will continue to benefit from management's underwriting discipline and improvements in scale and business mix while maintaining an overall very strong balance sheet strength assessment.

Definity Insurance's risk-adjusted capitalization is anticipated to remain at a level supporting robust business growth in line with the group’s strategy to be a top five property/casualty carrier in Canada. The ratings acknowledge the diversification in its lines of business and distribution systems, which contribute to its overall business profile. The company became public in November 2021 and to date maintains an unlevered balance sheet. AM Best expects that in the future the company will manage financial leverage and interest coverage ratios at a level that is aligned with the group’s current ratings.

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 © 2023 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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Michael Buckley
Financial Analyst

+1 908 882 1677

michael.buckley@ambest.com

Rosemarie Mirabella
Director

+1 908 882 2125

rosemarie.mirabella@ambest.com

Christopher Sharkey
Associate Director, Public Relations

+1 908 882 2310

christopher.sharkey@ambest.com

Al Slavin
Senior Public Relations Specialist

+1 908 882 2318

al.slavin@ambest.com

Source: AM Best