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FOR IMMEDIATE RELEASE
OLDWICK - OCTOBER 15, 2021 09:01 AM (EDT)
AM Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” (Excellent) to Richmond National Insurance Company (Richmond National) (Concord, NH). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect Richmond National’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
Richmond National was formed in 2021 and will focus exclusively on the U.S. excess and surplus lines market, writing coverage for a diverse mix of hard-to-place small business risks.
Richmond National’s very strong balance sheet strength is supported by its risk–adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), across all confidence intervals in current periods, projected future scores and under stress scenarios. Richmond National’s balance sheet assessment reflects the recent capital raise in support of planned premium growth, the conservative nature in which the investment portfolio will be established and the protection afforded by its comprehensive reinsurance program diversified among highly rated participants. Given the cautious nature in which management plans to grow the business, capital is in place on day one to support the five-year written premium business plan.
AM Best assesses Richmond National’s operating performance as adequate based on a clearly defined and practicable business plan, which includes management’s objective to achieve pre-tax operating profitability within the initial five-year period.
Richmond National’s business profile assessment is limited given the start-up nature of the organization.
Richmond National has developed the framework to establish a strong ERM culture throughout the organization, which AM Best considers appropriate given the scale, scope and complexity of the organization.
Positive rating actions are unlikely over the near term. Key factors that could result in negative rating action for Richmond National’s ratings and outlooks include failure to meet mid-term projections as shared with AM Best, particularly if the resulting performance falls short of similarly rated peers.
Negative rating actions also could occur should Richmond National’s risk-adjusted capitalization decline to a level that does not support its very strong balance sheet strength assessment.
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 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.