A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and issuer credit ratings (ICR) of “a-“ of Employers Insurance Company of Nevada (Reno, NV), Employers Compensation Insurance Company (Glendale, CA), Employers Preferred Insurance Company and Employers Assurance Company (both domiciled in Maitland, FL), collectively referred to as EMPLOYERS. Concurrently, A.M. Best has affirmed the ICR of "bbb-" of EMPLOYERS' publicly traded parent holding company, Employers Holdings Inc. (EHI) (Reno, NV) [NYSE: EIG]. The outlook for all ratings has been revised to negative from stable.
The affirmation of the ratings reflects EMPLOYERS’ supportive capitalization, historically strong operating performance and management's market expertise. The group also benefits from the financial flexibility afforded by EHI, which infused $70 million during the third quarter of 2012 into the operating companies in support of ongoing premium growth. A.M. Best expects the group’s underwriting performance will remain in line with or modestly outperform the workers’ compensation composite for the more recent accident years given management’s disciplined underwriting philosophy and prudent reserving practices.
Offsetting these positive rating factors and driving the revised outlook are the significant premium growth in the most recent calendar years, which has strained overall risk-adjusted capitalization and the emergence of modest adverse loss reserve development occurring on recent accident years. While EMPLOYERS’ calendar year operating results outperform its workers’ compensation composite peers, recent accident year results are more in line with the peer group averages. A.M. Best is concerned that the strong growth under challenging market conditions could result in deterioration of EMPLOYERS’ results over time. An additional offsetting rating factor is EMPLOYERS’ business concentration risk operating as a monoline workers’ compensation insurer with a relatively high concentration of premium volume in a select number of states.
A.M. Best will continue to monitor the performance of EMPLOYERS' expansion initiatives to ensure that premium growth and the accumulation of loss reserves do not further strain its capitalization and that overall operating results are achieved in accordance with A.M. Best’s expectations.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV