AM Best


A.M. Best Revises Outlook to Stable for the Issuer Credit Rating of Ocean Harbor Casualty Insurance Company and its Affiliates


CONTACTS:

Kevin Dorsey
Senior Financial Analyst
(908) 439-2200, ext. 5401
kevin.dorsey@ambest.com

Gary Davis
Assistant Vice President
(908) 439-2200, ext. 5665
gary.davis@ambest.com
Christopher Sharkey
Manager, Public Relations
(908) 439-2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Assistant Vice President, Public Relations
(908) 439-2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - JUNE 12, 2015 01:07 PM (EDT)
A.M. Best has revised the outlook for the issuer credit rating (ICR) to stable from negative and affirmed the financial strength rating (FSR) of B (Fair) and the ICR of "bb+" of Ocean Harbor Casualty Insurance Company (OHCIC) (headquartered in New York City, NY) and its affiliates, Great Northwest Insurance Company (GNIC) (St. Paul, MN) and Hawaiian Insurance and Guaranty Insurance Company, Limited (HIG) (Honolulu, HI). The outlook for the FSR remains stable.

The revised outlook reflects OHCIC's trend of positive consolidated five-year pre-tax operating performance, improved overall capitalization and reduced net leverage, which includes the five-year operating results of GNIC and HIG. Operating profitability was derived primarily from the group's conservative bond portfolio that generated consistent investment income over the latest period, which offset underwriting losses. Additionally, OHCIC has historically had favorable loss reserve development.

There may be positive future rating or outlook changes, if the group generates sustained operating income that grows policyholders' surplus and increases risk-adjusted capitalization as reflected by Best's Capital Adequacy Ratio (BCAR).

However, there may be future potential negative rating actions if the group's operating performance deteriorates and erodes policyholders' surplus, or there is increased underwriting leverage that causes a further decline in its risk-adjusted capitalization as reflected in the BCAR score.

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:


  • Catastrophe Analysis in A.M. Best Ratings

  • Rating Members of Insurance Groups

  • Risk Management and the Rating Process for Insurance Companies

  • Understanding BCAR for Property/Casualty Insurers

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.


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