AM Best affirms Sooner ratings

AM Best has affirmed the financial strength rating of A and the long-term

issuer credit rating of “a+” of Sooner Insurance Company. The outlook of

these ratings is stable.

According to AM Best the ratings reflect Sooner’s balance sheet strength,

which it assesses as ‘very strong’, as well as its strong operating

performance, neutral business profile and appropriate enterprise risk

management (ERM).

Sooner’s balance sheet strength is underpinned by its risk-adjusted

capitalisation at the strongest level, as measured by Best’s Capital

Adequacy Ratio (BCAR), generally favourable loss reserve development

and low underwriting leverage. Sooner’s most significant asset is a loan-

back to its ultimate parent, ConocoPhillips. The arrangement provides

Sooner’s capital and has relatively low risk due to the parent-subsidiary

affiliation, as well as the parent’s strong balance sheet and history of

positive earnings.

AM Best said that Sooner has a sustained history of strong operating

performance, with underwriting results and return on revenue metrics

outperforming the commercial casualty composite. The company’s loss

experience has been largely favourable for more than a decade due in

large part to ConocoPhillips’s strong risk management programs. In 2025,

underwriting results weakened due to increased claims costs but

continued to be profitable. Significant net investment income on the loan-

back continues to be the primary source of the company’s solid earnings.

As a core component in ConocoPhillips’ ERM program, the captive

arrangement affords the corporation flexibility to manage infrequent,

large losses efficiently and productively.

The neutral business profile assessment reflects Sooner’s position as the

primary captive insurer for its ultimate parent. Sooner’s underwriting risks

mainly provide property damage and excess liability coverage to

ConocoPhillips and its global subsidiaries as well as joint ventures.

The enterprise’s ERM embodies an integrated culture of risk awareness

and a framework to identify and manage various types of risks continually,

including periodic reviews of its potential loss exposures through a

specialist within industrial risks, a process AM Best views as appropriate

for the company’s risk profile. The ratings also reflect Sooner’s strategic

role for ConocoPhillips as evidenced by the parent’s ongoing implicit and

explicit support of this captive.