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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - OCTOBER 10, 2011 12:00 AM (EDT)
A.M. Best Co. has revised the outlook to negative from stable and affirmed the financial strength rating (FSR) of B (Fair) and issuer credit rating (ICR) of "bb" of Safe Harbor Insurance Company (Safe Harbor) (Tallahassee, FL).
The revised outlook reflects Safe Harbor's reduced risk-adjusted capitalization resulting from double-digit premium and exposure growth, as well as its increased reliance on the Florida Hurricane Catastrophe Fund as part of its current year reinsurance program.
Additionally, Safe Harbor's ratings are based on its geographic concentration of risk, which subjects it to a single state's judicial and regulatory actions, while exposing the company's property risks to hurricane events since it is a Florida-only writer of homeowner and mobile home business.
These negative rating factors are offset by Safe Harbor's favorable operating performance since inception and its ongoing strategic position within RM Ocean Harbor Holding Inc., whose lead insurance company is Ocean Harbor Casualty Insurance Company within the Ocean Harbor Insurance Group (OHIG). Currently, OHIG's FSR of B+ (Good) and ICR of "bbb-"are under review with negative implications following its announced acquisition of GNW Acquisition Corp.
The principal methodology used in determining these ratings is Best's Credit Rating Methodology - Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best's rating process and highlights the different rating criteria employed. Additional key criteria utilized include: "Risk Management and the Rating Process for Insurance Companies"; "Understanding BCAR for Property/Casualty Insurers"; "Rating Members of Insurance Groups"; and "A.M. Best's Ratings & the Treatment of Debt." Methodologies can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.