OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of Journey Insurance Company (Journey) (St. Petersburg, FL).
The ratings reflect Journey’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.
Journey is majority owned by United Insurance Holdings Corp. (UIHC) [NASDAQ: UIHC]. The company’s overall balance sheet strength assessment includes an evaluation of the impact from the ultimate parent, and while currently assessed as neutral, UIHC has reported material equity erosion in 2020 and year-to-date 2021, primarily driven by catastrophe losses. The negative outlooks reflect the observed deterioration in the consolidated financial position of UIHC and its risk-adjusted capitalization, as measured by Best’s Credit Adequacy Ratio (BCAR), which pressures Journey’s overall balance sheet strength assessment. Management has outlined near-term plans to stabilize the consolidated group’s operating performance and curb further erosion of capital.
Journey was created in 2018 to take advantage of market opportunities within Florida, Texas and South Carolina, specifically regarding commercial property coverage. The company’s balance sheet strength assessment reflects the infusion of significant capital intended to support growth as it relates to underwriting, credit and investment risks. AM Best will monitor the execution of near-term plans as communicated by management and their impact on alleviating pressure on Journey’s balance sheet strength.
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. For more information, visit www.ambest.com.
Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
