AM Best keeps NASWIC ratings under review

AM Best has maintained the under review with negative implications status for the financial strength rating of A- and the long-term issuer credit rating of “a-” of NASW Insurance Company (NASWIC).

The ratings reflect NASWIC’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

The under review with negative implications status was based on the uncertainty regarding NASWIC’s prospective business plans to operate on a stand-alone basis due to its separation from Preferra Insurance Company Risk Retention Group (Preferra RRG), which involved litigation with Preferra RRG. The litigation was settled a few months ago, enabling the parties to focus their efforts on serving the interests of their respective stakeholders.

The extension of the under review with negative implications status reflects the additional time needed for management to fully execute its plans, namely the formation of a risk retention group (RRG) that has experienced delays due to litigation and settlement processes. Management is engaged with the District of Columbia on regulatory aspects of the RRG application to ensure compliance with all applicable regulations. In addition, NASWIC’s marketing campaign to increase production through its affinity partnership with Hartford is currently underway.

The ratings for NASWIC will remain under review with negative implications until AM Best evaluates the ratings of the company on a stand-alone basis.

 Did you get value from this story?  Sign up to our free daily newsletters and get stories like this sent straight to your inbox.