AM Best Revises Outlooks to Positive for Members of CapSpecialty Insurance Group

AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a+” (Excellent) of Capitol Indemnity Corporation (Middleton, WI), Capitol Specialty Insurance Corporation (Middleton, WI) and Platte River Insurance Company (Omaha, NE), collectively known as CapSpecialty Insurance Group (CapSpecialty).

The Credit Ratings (ratings) reflect CapSpecialty’s balance sheet strength, which AM Best assesses as strongest, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management.

CapSpecialty’s risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), has been consistently maintained at the strongest level and benefits from the significant reinsurance agreements put in place with its affiliated National Indemnity Company, which reduced CapSpecialty’s net premium and reserve leverage ratios. CapSpecialty’s investments are managed by Berkshire Hathaway Inc., and are expected to show, over time, an increase in allocations to common stocks with high intrinsic value, in accordance with Berkshire Hathaway Inc.’s investment philosophy.

AM Best assesses CapSpecialty’s operating performance as marginal, with revised outlooks to positive from stable. The positive outlooks reflect AM Best’s view that underwriting actions taken by the group have led to improved underwriting results and reduced volatility that should be sustainable in the future. CapSpecialty’s underwriting metrics and overall profitability have recently been consistent with levels supportive of a future shift to an adequate operating performance assessment and are projected to maintain its recent favorable trends for the foreseeable future.

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.

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