AM Best Downgrades Wawanesa General Insurance Company (US) Credit Ratings; Confirms credit ratings from Wawanesa Mutual Insurance Company and Wawanesa Life Insurance Company

OLDWICK, NJ December 16, 2022–(BUSINESS WIRE)–am the best has downgraded its Financial Strength Rating (FSR) from A- (Excellent) to B (Good) and its Long-Term Issuer Credit Rating (Long-Term ICR) from “a-” (Excellent) to “bb” (Good). General Insurance Company of Wawanesa (Wawanesa General) (San Diego, CA). At the same time, AM Best has subjected these credit ratings with negative effects to a review.

At the same time, AM Best has confirmed the FSR of A (excellent) and long-term ICR of “a” (excellent) from The Wawanesa Mutual Insurance Company (Wawanesa Mutual). AM Best has also certified Wawanesa Life Insurance Company’s (Wawanesa Life) FSR of A (excellent) and long-term ICR of “a” (excellent). The outlook of these ratings is stable. All companies are headquartered in Winnipeg, Manitoba, Canada unless otherwise noted.

Wawanesa General’s ratings reflect its balance sheet strength, which AM Best considers reasonable, its marginal operating performance, limited business profile and adequate enterprise risk management (ERM). The downgrading of Wawanesa General’s ratings reflects the significant decline in policyholder surplus during 2022, which accelerated in the third quarter of 2022, driven by a decline in operating performance driven by an increase in claims costs, which in part was due to the current inflationary environment. The weaker performance was significantly impacted by the inability to obtain reasonable rate increases from the California Department of Insurance. The results were also negatively impacted by a $54.1 million adverse reserve development that occurred in prior accident years through September 30, 2022. Ratings are under review with negative implications pending further discussions with management as AM Best assesses the continued impact of the California automotive marketplace on Wawanesa General.

READ :  What forms do I need to buyout my leased car?

Wawanesa Mutual’s ratings reflect its balance sheet strength, which AM Best rates as very strong, reasonable operational performance, neutral business profile and reasonable ERM. The stable outlook reflects the expectation that Wawanesa Mutual’s rating fundamentals will remain unchanged over the medium term. Given the company’s conservative capital management, risk-adjusted capitalization as measured by BCAR is expected to remain at the highest level. Despite moderate volatility, operational performance is expected to remain reasonable, supported by investment returns, which have generally offset underwriting losses and driven organic growth in policyholder participation.

Wawanesa Life’s ratings reflect its balance sheet strength, which AM Best rates as very strong, reasonable operational performance, neutral business profile and reasonable ERM. Wawanesa Life’s strongest risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR), supports the company’s business, investment and insurance risks. In addition, the company maintains a robust Life Insurance Capital Adequacy Test (LICAT) rate. The stable outlook reflects the expectation that Wawanesa Life will maintain balance sheet valuations at very strong levels over the medium term and reasonable operating results will contribute to excess growth. In addition, the stable outlook reflects AM Best’s expectations that Wawanesa Life will maintain its strategic importance to Wawanesa Mutual over the medium term.

This press release relates to ratings published on AM Best’s website. All ratings information relating to the press release and relevant disclosures, including details of the issuing authority for each rating referenced in this press release, can be found at AM Best Last review activity site. Learn more about the use and limitations of the credit score Opinions, please see Best Credit Ratings Guide. Information on the proper use of Best’s credit ratings, Best’s performance reviews, Best’s preliminary credit rating and AM Best’s press releases can be found here Guide to Proper Use of Best’s Ratings & Assessments.

READ :  Why people should get renters insurance: The benefits

AM Best is a global rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company operates in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information visit www.ambest.com.

Copyright © 2022 by AM Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com: https://www.businesswire.com/news/home/20221216005511/en/

contacts

Gordon McLean
Senior Financial Analyst
+1 908.439.2200, extension 5304
[email protected]

Rosemary Mirabella
director
+1 908.439.2200, extension 5892
[email protected]

Christopher Sharkey
manager, public relations
+1 908.439.2200, extension 5159
[email protected]

Al Slawin
Senior Specialist in Public Relations
+1 908.439.2200, extension 5098
[email protected]

Leave a Reply

Your email address will not be published. Required fields are marked *