OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has downgraded the Financial Strength Rating to A- (Excellent) from A (Excellent) and the Long-Term Issuer Credit Rating to “a-” (Excellent) from “a” (Excellent) of Caring Communities Insurance Company (CCIC) (Cayman Islands). The outlook of these Credit Ratings (ratings) is stable. Concurrently, AM Best has withdrawn these ratings as the company has requested to no longer participate in AM Best’s interactive rating process.
The ratings reflect CCIC’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.
The downgrades reflect CCIC’s ratings on a stand-alone basis, after previously receiving a grouped rating from its parent, following notification that CCIC will discontinue writing new business and effectively be placed into runoff. CCIC’s balance sheet strength is underpinned by its risk-adjusted capitalization, which is at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), partially offset by limited financial flexibility and relatively lower level of surplus. AM Best expects the company’s risk-adjusted capitalization to be maintained at the strongest level throughout the entire run-off period. The company benefits from a liquid investment portfolio and has a history of prudent reserving and favorable development. Nevertheless, future earnings prospects are limited due to recent changes in business strategy and discontinuation of all lines of business. Management expects loss reserves to complete runoff by 2027.
The stable outlooks reflect AM Best’s expectation that CCIC’s risk-adjusted capitalization will remain at the strongest level and that the company will be able to maintain adequate operating performance from modest investment income as it operates through the runoff of its liabilities.
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