AM Best Downgrades Issuer Credit Rating of Finger Lakes Fire and Casualty Company
OLDWICK, N.J.--(BUSINESS WIRE)--Dec 15, 2022--
AM Best has downgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “a” (Excellent) from “a+” (Excellent) and affirmed the Financial Strength Rating (FSR) of A (Excellent) of Finger Lakes Fire and Casualty Company (Finger Lakes) (Trumansburg, NY). The outlook of the Long-Term ICR has been revised to stable from negative, while the outlook of the FSR is stable.
The Credit Ratings (ratings) reflect Finger Lakes’ balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
The downgrade of the Long-Term ICR is based on the revision of the company’s operating performance assessment to adequate from strong, reflective of volatile operating results largely driven by weather-related losses, inflationary pressures and supply chain delays, which have increased loss costs in recent years. In addition, the company’s expense ratio is elevated compared with peers in the personal property composite due to a higher-than-average commission expense structure. As the result of these factors, Finger Lakes has reported unfavorable underwriting results starting in 2019 and through the third quarter of 2022. Furthermore, the company’s operating performance metrics are more in line with the adequate assessment.
Finger Lakes’ management has implemented several initiatives including pre-renewal inspection, underwriting authority, non-renewing unprofitable business, rate revisions, and policy rewrites, which should help to stabilize results and eventually lessen volatility.
This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
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KEYWORD: EUROPE UNITED STATES NORTH AMERICA NEW JERSEY
INDUSTRY KEYWORD: INSURANCE PROFESSIONAL SERVICES
SOURCE: AM Best
Copyright Business Wire 2022.
PUB: 12/15/2022 03:10 PM/DISC: 12/15/2022 03:10 PM