PSIC’s ratings recognize its excellent risk-adjusted capitalization, operational and financial support of affiliates, experienced management team and its targeted earnings and capital accumulation projections set forth by management. In addition, the ratings consider the mitigation of underwriting risks through substantial reinsurance programs.These positive factors are partially offset by the significant challenges and uncertainties associated with PSIC’s newly formed business operations, including the successful execution of its operating plans in highly competitive property/casualty markets, the property catastrophe exposure of its dominant Florida BOP operations and the potential variability in profitability of its more limited miscellaneous professional lines errors and omissions business. Furthermore, the production of PSIC’s Florida BOP business is concentrated with one managing general agent. Explicit support from PSIC’s affiliates includes a financial guarantee of all its liabilities and/or obligations and stop loss coverage being provided by its financially strong parent, Protective Insurance Company, the lead company of the Group. PSIC’s ultimate parent, Baldwin & Lyons Inc., also is financially strong with very low financial leverage and solid coverage ratios, as well as access to the capital markets. As with any company rapidly expanding its business, A.M. Best will closely monitor PSIC’s progress to ensure targeted results are attained, and capital and surplus are in compliance with A.M. Best standards relative to its ratings. For Best’s Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.