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HOUSTON, Sept. 28, 2012 (GLOBE NEWSWIRE) --
HCC Insurance Holdings, Inc. (NYSE:HCC) today announced that A.M. Best Company has upgraded the issuer credit rating (ICR) of HCC Life Insurance Company (HCC Life) to "aa" from "aa-" and affirmed its financial strength rating (FSR) of "A+ (Superior)", both with a "stable" outlook. A.M. Best also affirmed the FSRs of "A+ (Superior)" and the ICRs of "aa" with a "stable" outlook of the property and casualty members of the Houston Casualty Group. Additionally, the ICR and debt rating of "a" were affirmed on the $300 million 6.300% Senior Notes due 2019 of the holding company with a "stable" outlook.
In a press release dated September 26, 2012 regarding HCC's and its subsidiaries' ratings, A.M. Best commented, "The ratings of HCC reflect its long-standing presence in the specialty property/casualty market, its sustained profitability, strong capitalization, as well as substantial financial flexibility afforded by HCC Holdings. These rating attributes are largely supported by HCC's business strategies, which have long focused on underwriting within defined commercial specialty lines, effective utilization of affiliated underwriting agencies/insurance intermediaries and the optimal utilization of reinsurance protection. These strategies have helped produce consistent operating profits in recent years despite challenging market conditions. The ratings also acknowledge HCC's near-term earnings prospects, its strong position in the specialty admitted and non-admitted market segments, low to moderate risk profile and its conservative investment strategy."
"We are very pleased with A.M. Best's recently announced ratings upgrade and affirmations and believe these actions acknowledge the strength of our business model and balance sheet and the consistency of our profitability across market cycles," said John N. Molbeck, Jr., HCC's Chief Executive Officer.
The following insurance companies comprise the property and casualty members of Houston Casualty Group, as defined by A.M. Best:
Houston Casualty Company
U.S. Specialty Insurance Company
Avemco Insurance Company
HCC Specialty Insurance Company
A.M. Best also affirmed the FSRs of "A+ (Superior)" and ICRs of "aa-" for the following insurance company subsidiaries of HCC:
American Contractors Indemnity Company ("stable" outlook)
United States Surety Company ("stable" outlook)
Perico Life Insurance Company (Perico) ("negative" outlook)
During 2011, management ceased writing new medical stop-loss business on the books of Perico and currently writes all new and renewal business on the books of HCC Life. A.M. Best explained in its press release that the "negative" outlook for Perico is due to the entity essentially being placed into run off, which precludes full rating enhancement under its group rating criteria.