AM Best assigns ratings to start-up ESI

AM Best has assigned a financial strength rating of B+ (Good) and a long-term issuer credit rating of “bbb-” to Elan Solutions (ESI). The outlook assigned to these credit ratings is stable.

ESI commenced business on October 1, 2016 in the US Virgin Islands and primarily services group major medical business.

According to AM Best, the ratings reflect ESI’s business profile, projected premium and operating earnings growth and adequate level of risk-adjusted capital. The company’s management is experienced in the Caribbean basin and has brought in service support to administer its initial block of insured members while executing on its plan to grow and expand into other products or locales. Although absolute capital levels are expected to decline as premium grows, ESI is projected to maintain adequate levels of risk-adjusted capitalization through operating gains.

Due to its status as a start-up company AM Best expects ESI to face challenges from market pressure and barriers to expand. Market challenges may include regulatory pressure, provider relationship strain, changing demographics affected by the overall dynamic of the marketplace and ESI’s ability to adapt and respond to market changes and implement improvements without disrupting operations.

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