A.M. Best Affirms Ratings of Selective Insurance Group, Inc. and Its Subsidiaries
May 28 2015 - 10:39AM
Business Wire
A.M. Best has affirmed the financial strength rating
(FSR) of A (Excellent) and the issuer credit ratings (ICR) of “a+”
of Selective Insurance Company of America and its nine
pooled affiliates, collectively referred to as Selective. In
addition, A.M. Best has affirmed the ICR of “bbb+” and the debt
ratings of Selective’s parent, Selective Insurance Group,
Inc. (SIGI) (NASDAQ:SIGI). The outlook for all ratings is
stable. All companies are headquartered in Branchville, NJ. (Please
see below for a detailed listing of companies and ratings.)
The ratings reflect Selective’s excellent level of risk-adjusted
capitalization, its established position in its targeted regional
markets, which is reinforced by its strong independent agency
relationships, and consistently profitable operating performance.
Those operating results are derived from Selective’s underwriting
discipline, reflected in the group’s underwriting results that have
generally outperformed the commercial casualty composite average in
recent years. The group’s consistently stable loss-reserve position
enhances its balance sheet and risk-adjusted capital position, and
operating results have benefited from recognition of favorable
development of loss reserves in nine straight calendar years. The
ratings also consider Selective’s position as a top 50 U.S.
property/casualty enterprise (based on net written premiums), its
experienced management team and the financial flexibility afforded
by SIGI.
Offsetting these positive rating factors are Selective’s net
investment ratio and investment yields that generally trail the
composite averages, and which over the past five years have
resulted in operating results that are generally not in line with
those of the broad peer group or similarly rated enterprises; and
elevated levels of underwriting leverage.
SIGI’s debt-to-total capital (excluding accumulated other
comprehensive income) of 23.0% and adjusted debt-to-tangible
capital of 23.1% at March 31, 2015, were within A.M. Best’s
guidelines for the company’s ratings. In addition, SIGI’s interest
coverage ratio remains adequate for its ratings.
Positive rating movement may result if Selective outperforms its
peers for an extended period of time. Negative rating pressure
could result if operating performance falls markedly short of A.M.
Best’s expectations or if there is a significant deterioration in
the organization’s risk-adjusted capitalization as measured by
Best’s Capital Adequacy Ratio (BCAR).
The FSR of A (Excellent) and the ICRs of “a+” have been affirmed
for Selective Insurance Company of America and its following
affiliates:
- Selective Way Insurance
Company
- Selective Insurance Company of the
Southeast
- Selective Insurance Company of New
York
- Selective Insurance Company of South
Carolina
- Selective Insurance Company of New
England
- Selective Auto Insurance Company of
New Jersey
- Mesa Underwriters Specialty
Insurance Company
- Selective Casualty Insurance
Company
- Selective Fire & Casualty
Insurance Company
The following debt ratings have been affirmed:
Selective Insurance Group, Inc.—-- “bbb+” on $49.9
million 7.25% senior unsecured notes, due 2034-- “bbb+” on $99.5
million 6.70% senior unsecured notes, due 2035-- “bbb+” on $185
million 5.875% senior unsecured notes, due 2043
The following indicative ratings on the shelf registration have
been affirmed:
Selective Insurance Group, Inc.—-- “bbb+” on senior
unsecured debt-- “bbb” on subordinated debt-- “bbb-” on preferred
stock
The methodology used in determining these ratings is Best’s
Credit Rating Methodology, which provides a comprehensive
explanation of A.M. Best’s rating process and contains the
different rating criteria employed in the rating process. Best’s
Credit Rating Methodology can be found at
www.ambest.com/ratings/methodology.
Key insurance criteria reports utilized:
- Analyzing Insurance Holding Company
Liquidity
- Catastrophe Analysis in A.M. Best
Ratings
- Equity Credit for Hybrid
Securities
- Insurance Holding Company and Debt
Ratings
- Rating Members of Insurance Groups
- Risk Management and the Rating Process
for Insurance Companies
- The Treatment of Terrorism Risk in the
Rating Evaluation
- Understanding BCAR for
Property/Casualty Insurers
- Understanding Universal BCAR
This press release relates to rating(s) 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 visit A.M.
Best’s Ratings & Criteria Center.
A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2015 by A.M. Best Company,
Inc. ALL RIGHTS RESERVED.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150528006023/en/
A.M. Best Company, Inc.Brian O'Larte,
908-439-2200, ext. 5138Senior Financial
Analystbrian.o'larte@ambest.comorJennifer
Marshall, 908-439-2200, ext. 5327Assistant Vice
Presidentjennifer.marshall@ambest.comorChristopher
Sharkey, 908-439-2200, ext. 5159Manager, Public
Relationschristopher.sharkey@ambest.comorJim Peavy,
908-439-2200, ext. 5644Assistant Vice President, Public
Relationsjames.peavy@ambest.com
Selective Insurance (NASDAQ:SIGI)
Historical Stock Chart
From Mar 2024 to Apr 2024
Selective Insurance (NASDAQ:SIGI)
Historical Stock Chart
From Apr 2023 to Apr 2024