Travelers' ratings also consider the financial flexibility and liquidity provided by TRV. TRV held $2.5 billion of liquid funds at June 30, 2017, $490 million of which was used in the August 2017 acquisition of Simply Business, with a further $450 million earmarked to fund a December 2017 debt maturity. Substantial remaining excess liquidity is net of sizable common stock repurchases over the past several years. TRV's debt-to-capital ratio at June 30, 2017 remained modest at 22.5%. Adjusting for tangible capital, the debt-to-tangible capital ratio is 25.7%, well within A.M. Best's expectation for the current rating levels. Interest coverage also remained strong through 2016 at 12.0 times. Due to higher catastrophe losses in 2017, A.M. Best expects interest coverage to decline in 2017 but remain in the high single digits, which remains supportive of the current "a+" rating.Offsetting these positive rating factors are the ongoing competitive environment within the property/casualty markets, Travelers' relatively significant exposure to natural and man-made catastrophes and challenges in its personal auto business. Travelers has comprehensive reinsurance and risk management programs in place to manage its spread of risk and limit its overall exposure. Despite reporting an increased level of catastrophe losses in 2011 and 2012, Travelers reported solid returns in those years while maintaining strong liquidity and risk-adjusted capitalization, demonstrating the group's conservative operating philosophy, strong business profile and comprehensive risk management program. A.M. Best expects that this will also be the case in 2017, when earnings will be pressured by catastrophe losses related to Hurricanes Harvey, Irma, and Maria. Expense reductions and the implementation of the Quantum 2.0 underwriting system have driven recent growth in personal auto. A.M. Best expects that the losses incurred by Travelers following the recent catastrophic events, including Hurricanes Harvey, Irma and Maria and recent seismic activity in Mexico, will be contained within the organization's risk tolerances, although these will, as noted above, have a negative impact on earnings for the year. A.M. Best will monitor Travelers' loss activity associated with these events and will update its assessment of Travelers' risk management capabilities and ratings should there be a material deviation from expectations.
The ratings of TCSA and its 100% reinsured affiliate, TCSCE, primarily recognize the companies' strong consolidated risk-adjusted capitalization, specialized underwriting expertise, highly favorable underwriting and operating performance and leadership position in the surety, fidelity and management liability segments. These strengths are partially offset by TCSA's limited product diversification, as well as the negative impact that continued competitive property/casualty markets and challenging macroeconomic conditions may have on premium and profitability levels.The ratings of TICC reflect its superior risk-adjusted capitalization, favorable underwriting and operating profitability, excellent brand recognition, strong profile as a leading specialty lines writer in the surety and corporate management liability segments, as well as the implicit and explicit support received from its direct parent, TCSA, as well as its ultimate parent, TRV. Partially offsetting these positive rating factors are continued soft market conditions and its relatively elevated expense ratio due, in part, to investments in technology. The ratings of Dominion reflect its solid risk-adjusted capitalization; excellent brand recognition; established nationwide Canadian market presence, with a focus in Ontario; and the implicit and explicit support it receives from its parent, TRV. Partially offsetting these positive rating factors is the company's fluctuating operating performance, which was impacted in 2016 by catastrophe losses. Additional offsetting factors include recent increased competition and continued lower investment yields. The ratings of First Floridian recognize its strong risk-adjusted capitalization, operating efficiencies and local market focus, which enables it to respond effectively to issues associated with Florida's personal lines market, and the additional operational support and financial flexibility afforded by TRV. The company has generated strong operating results during the recent five- and 10-year periods as evidenced by its average pre-tax and total return measures. However, this strong performance coincided with a period during which no significant hurricanes made landfall in Florida. Partially offsetting these strengths are First Floridian's continued, albeit declining, exposure to catastrophe losses and single state geographic concentration in Florida. The company's underwriting performance is expected to deteriorate sharply in 2017, due to losses from Hurricane Irma, which impacted Florida in the third quarter of 2017. A.M. nevertheless expects First Floridian's risk-adjusted capitalization to remain strongly supportive of its ratings.
The ratings of Premier acknowledge its strong risk-adjusted capitalization, historically favorable operating profitability and the additional operational support and financial flexibility afforded by Travelers and TRV. These positive rating factors are partly offset by Premier's underwriting losses earlier in most recent five-year period and the concentration of its business in a single state and line of business, specifically, Massachusetts private passenger automobile. As noted above, the company has been placed into run-off and its ratings have been withdrawn concurrent with the affirmation.Positive rating movement is unlikely in the near term. Factors that could lead to negative rating actions include deterioration in underwriting and operating performance to a level below A.M. Best's expectations, an erosion of surplus that causes a decline in risk-adjusted capital to a level that is no longer supportive of the current ratings or a deterioration in TRV's overall financial strength or credit quality. For a complete listing of The Travelers Companies, Inc.'s FSRs, Long-Term ICRs, Long-Term IRs and Short-Term IRs, please visit The Travelers Companies, Inc . This press release relates to rating(s) that have been published on A.M. 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 A.M. Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best's Credit Ratings . For information on the proper media use of Best's Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating Action Press Releases . A.M. Best is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.