< PreviousBest’s Credit Rating Actions 68BEST’S REVIEW • NOVEMBER 2022 Rating Action Business Type Company Name/ Ultimate ParentAMB# CurrentPrevious Domicile FSR ICR Outlook/ Implications FSR ICR Outlook/ Implications AMERICAS PROPERTY/CASUALTY (CONTINUED) Outlook Change P American Family Mutual Ins Co, S.I. American Family Ins Mutual Holding Co 002022 AStableAStable Wisconsin, USA a+Negativea+Stable Implications Change P American Millennium Insurance Company Sirius International Limited 000512 C- uDevelopingC- uNegative New Jersey, USA cc uDevelopingcc uNegative Outlook Change P American Standard Ins Co of Wisconsin American Family Ins Mutual Holding Co 002023 AStableAStable Wisconsin, USA a+Negativea+Stable Outlook Change P American Standard Insurance Co of Ohio American Family Ins Mutual Holding Co 011790 AStableAStable Wisconsin, USA a+Negativea+Stable UpgradeP Ardellis Insurance Ltd. UFP Industries, Inc. 075126 AStableA-Positive Bermuda aStablea-Positive Outlook Change P Austin Mutual Insurance Company American Family Ins Mutual Holding Co 000182 AStableAStable Minnesota, USA a+Negativea+Stable UpgradeP BrickStreet Mutual Insurance Company Encova Mutual Insurance Group, Inc. 003484 AStableA-Positive West Virginia, USA aStablea-Positive Rating Withdrawal P Business Alliance Insurance Company National Farm Financial Corporation 012047 NRB+Stable California, USA nrbbb-Stable Implications Change P Citadel Reinsurance Company Ltd Sirius International Limited 083735 B uDevelopingB uNegative Bermuda bb uDevelopingbb uNegative UpgradeP Consumers Insurance USA, Inc. Encova Mutual Insurance Group, Inc. 011775 AStableA-Positive Ohio, USA aStablea-Positive Initial Rating PElement Insurance Company020970 B+StableNR Ohio, USA bbb-Stablenr Outlook Change P General Automobile Insurance Company American Family Ins Mutual Holding Co 014118 AStableAStable Wisconsin, USA a+Negativea+Stable Outlook Change P General Security Indemnity Co of Arizona SCOR SE 002837 A+NegativeA+Stable Arizona, USA aa-Negativeaa-Stable Outlook Change P General Security National Insurance Co SCOR SE 002665 A+NegativeA+Stable New York, USA aa-Negativeaa-Stable Outlook Change P Grain Dealers Mutual Insurance Company American Family Ins Mutual Holding Co 002207 AStableAStable Indiana, USA a+Negativea+Stable Outlook Change P Guardian Insurance Company, Inc. Lockhart Companies, Inc. 011328 B++StableB++Negative U.S. Virgin Islands bbbStablebbbNegative Outlook Change P Hawaii Employers’ Mutual Ins Co, Inc. Hawaii Employers’ Mutual Ins Co, Inc. 012060 ANegativeAStable Hawaii, USA aNegativeaStable Outlook Change P Homesite Indemnity Company American Family Ins Mutual Holding Co 022137 AStableAStable Wisconsin, USA a+Negativea+Stable Outlook Change P Homesite Insurance Co of the Midwest American Family Ins Mutual Holding Co 022138 AStableAStable Wisconsin, USA a+Negativea+Stable Outlook Change P Homesite Insurance Company American Family Ins Mutual Holding Co 022141 AStableAStable Wisconsin, USA a+Negativea+Stable Outlook Change P Homesite Insurance Company of California American Family Ins Mutual Holding Co 022234 AStableAStable California, USA a+Negativea+Stable Outlook Change P Homesite Insurance Company of Florida American Family Ins Mutual Holding Co 022142 AStableAStable Illinois, USA a+Negativea+Stable Outlook Change P Homesite Insurance Company of Georgia American Family Ins Mutual Holding Co 022139 AStableAStable Georgia, USA a+Negativea+Stable Outlook Change P Homesite Insurance Company of Illinois American Family Ins Mutual Holding Co 022140 AStableAStable Illinois, USA a+Negativea+Stable Outlook Change P Homesite Insurance Company of New York American Family Ins Mutual Holding Co 022135 AStableAStable New York, USA a+Negativea+Stable Outlook Change P Homesite Lloyd’s of Texas American Family Ins Mutual Holding Co 022136 AStableAStable Texas, USA a+Negativea+Stable UpgradeP Iowa American Insurance Company Encova Mutual Insurance Group, Inc. 003603 AStableA-Positive Ohio, USA aStablea-Positive Outlook: Positive, Negative, Stable. Implications: Positive, Negative, Developing. Business Type: P = Property/Casualty (Nonlife); L = Life; H = Health; T = Title; C = Composite. Opinion Modifiers: u = Under Review; sf = Structured Finance; i = Indicative Credit Rating Modifier; s = Syndicate Credit Rating Modifier69BEST’S REVIEW • NOVEMBER 2022 Rating Action Business Type Company Name/ Ultimate ParentAMB# CurrentPrevious Domicile FSR ICR Outlook/ Implications FSR ICR Outlook/ Implications AMERICAS PROPERTY/CASUALTY (CONTINUED) UpgradeP Iowa Mutual Insurance Company Encova Mutual Insurance Group, Inc. 000528 AStableA-Positive Ohio, USA aStablea-Positive Initial Rating P Jet Insurance Company Jet Financial Corp. 023354 B++StableNR North Carolina, USA bbb+Stablenr Initial Rating P La Capitale General Insurance Inc. Beneva Inc. 085721 AStableNR Quebec, CAN aStablenr Outlook Change P Main Street America Assurance Company American Family Ins Mutual Holding Co 000526 AStableAStable Florida, USA a+Negativea+Stable Outlook Change P Main Street America Protection Ins Co American Family Ins Mutual Holding Co 013849 AStableAStable Florida, USA a+Negativea+Stable UpgradeP MICO Insurance Company Encova Mutual Insurance Group, Inc. 001760 AStableA-Positive Ohio, USA aStablea-Positive Outlook Change P Midvale Indemnity Company American Family Ins Mutual Holding Co 022001 AStableAStable Wisconsin, USA a+Negativea+Stable UpgradeP Motorists Commercial Mutual Insurance Co Encova Mutual Insurance Group, Inc. 000132 AStableA-Positive Ohio, USA aStablea-Positive UpgradeP Motorists Mutual Insurance Company Encova Mutual Insurance Group, Inc. 000652 AStableA-Positive Ohio, USA aStablea-Positive Outlook Change P MSA Insurance Company American Family Ins Mutual Holding Co 013037 AStableAStable South Carolina, USA a+Negativea+Stable UpgradeP National American Insurance Company Chandler Insurance Company, Ltd. 000672 AStableA-Positive Oklahoma, USA aStablea-Positive Outlook Change P NGM Insurance Company American Family Ins Mutual Holding Co 000678 AStableAStable Florida, USA a+Negativea+Stable UpgradeP NorthStone Insurance Company Encova Mutual Insurance Group, Inc. 014002 AStableA-Positive West Virginia, USA aStablea-Positive Outlook Change P Old Dominion Insurance Company American Family Ins Mutual Holding Co 002822 AStableAStable Florida, USA a+Negativea+Stable Outlook Change P Permanent General Assurance Corp of Ohio American Family Ins Mutual Holding Co 011303 AStableAStable Wisconsin, USA a+Negativea+Stable Outlook Change P Permanent General Assurance Corporation American Family Ins Mutual Holding Co 001894 AStableAStable Wisconsin, USA a+Negativea+Stable UpgradeP Phenix Mutual Fire Insurance Company Encova Mutual Insurance Group, Inc. 002339 AStableA-Positive Ohio, USA aStablea-Positive UpgradeP PinnaclePoint Insurance Company Encova Mutual Insurance Group, Inc. 022025 AStableA-Positive West Virginia, USA aStablea-Positive Outlook Change P SCOR Canada Reinsurance Company SCOR SE 085445 A+NegativeA+Stable Ontario, CAN aa-Negativeaa-Stable Outlook Change P SCOR Reinsurance Company SCOR SE 003599 A+NegativeA+Stable New York, USA aa-Negativeaa-Stable Outlook Change P Spring Valley Mutual Insurance Company American Family Ins Mutual Holding Co 012436 AStableAStable Minnesota, USA a+Negativea+Stable UpgradeP SummitPoint Insurance Company Encova Mutual Insurance Group, Inc. 022024 AStableA-Positive West Virginia, USA aStablea-Positive Rating Withdrawal P Tower Hill Prime Insurance Company** Shively Family 012359 NRBNegative Florida, USA nrbbNegative UpgradeP Wilson Mutual Insurance Company Encova Mutual Insurance Group, Inc. 001964 AStableA-Positive Ohio, USA aStablea-Positive EUROPE, MIDDLE EAST AND AFRICA DowngradeC Milli Reasurans Turk Anonim Sirketi Turkiye Is Bankasi A.S. 085454 CNegativeB-Negative Turkey cccNegativebb-Negative Initial Rating P NEIL Overseas DAC Nuclear Electric Insurance Limited 089012 AStableNR Ireland a+Stablenr Outlook Change P Polskie Towarzystwo Reasekuracji S.A. Fairfax Financial Holdings Limited 089013 A-NegativeA-Stable Poland a-Negativea-Stable UpgradeP Samsung Fire & Marine Ins Co. of Europe Samsung Fire & Marine Insurance Co Ltd 091214 A++StableAStable United Kingdom aa+Stablea+Stable ** The ratings were downgraded to bb/B from bbb-/B+ on Sept. 28, 2022, and subsequently withdrawn. Outlook: Positive, Negative, Stable. Implications: Positive, Negative, Developing. Business Type: P = Property/Casualty (Nonlife); L = Life; H = Health; T = Title; C = Composite. Opinion Modifiers: u = Under Review; sf = Structured Finance; i = Indicative Credit Rating Modifier; s = Syndicate Credit Rating ModifierBest’s Credit Rating Actions 70BEST’S REVIEW • NOVEMBER 2022 Rating Action Business Type Company Name/ Ultimate ParentAMB# CurrentPrevious Domicile FSR ICR Outlook/ Implications FSR ICR Outlook/ Implications EUROPE, MIDDLE EAST AND AFRICA (CONTINUED) Outlook Change C SCOR SE SCOR SE 085027 A+NegativeA+Stable France aa-Negativeaa-Stable Outlook Change P SCOR UK Company Limited SCOR SE 085448 A+NegativeA+Stable United Kingdom aa-Negativeaa-Stable ASIA-PACIFIC Implications Change C Blue Cross (Asia-Pacific) Insurance Ltd The Bank of East Asia, Limited 090678 A uPositiveA uDeveloping Hong Kong a uPositivea uDeveloping Rating Affirmation P Cathay Century Insurance Co Ltd Cathay Financial Holding Co., Ltd. 077106 AStableA uNegative Taiwan aStablea uNegative Initial Rating PChina Shipowners Mutual Assurance Assoc074864 A-Stable China a-Stable UpgradeP Samsung Reinsurance Pte. Ltd. Samsung Fire & Marine Insurance Co Ltd 091577 A++StableAStable Singapore aa+StableaStable UpgradeP Samsung Vina Insurance Co., Ltd. Samsung Fire & Marine Insurance Co Ltd 091397 A++StableA-Stable Vietnam aa+Stablea-Stable Outlook Change C SCOR Reinsurance Asia-Pacific Pte Ltd SCOR SE 088684 A+NegativeA+Stable Singapore aa-Negativeaa-Stable AMERICAS Outlook Change L BUPA México Cía de Seguros SA de CV British United Provident Association Ltd 078090 C++PositiveC++Stable Mexico b+Positiveb+Stable Outlook Change CCompania Reaseguradora del Ecuador SA077239 B++PositiveB++Stable Ecuador bbb+Positivebbb+Stable Under Review P Genesis Global Insurance (SAC) Ltd. Colonial SA Compañía Seguros 074742 B++ uDevelopingB++Stable Bahamas bbb+ uDevelopingbbb+Stable Under Review P Mercantil Reaseguradora Internacional SA Mercantil Servicios Financieros Internac 092721 B++ uNegativeB++Stable Panama bbb uNegativebbbStable Under Review C Mercantil Seguros y Reaseguros, S.A. Mercantil Servicios Financieros Internac 088285 B++ uNegativeB++Stable Panama bbb uNegativebbbStable Under Review P Sagicor General Insurance Inc. Sagicor Financial Company Ltd. 086979 A- uDevelopingA-Stable Barbados a- uDevelopinga-Stable Under Review L Sagicor Life Inc. Sagicor Financial Company Ltd. 086569 A- uDevelopingA-Stable Barbados a- uDevelopinga-Stable Under Review L Sagicor Life Jamaica Limited Sagicor Financial Company Ltd. 086086 B++ uDevelopingB++Stable Jamaica bbb+ uDevelopingbbb+Stable Initial Rating C Seguros Reservas S.A. Banco de Reservas de la República DO 092870 A-StableNR Dominican Republic a-Stablenr Under Review P Wentworth Insurance Company Limited Fairfax Financial Holdings Limited 086298 A uNegativeAStable Barbados a uNegativeaStable Holding Companies Rating ActionCompany NameAMB# CurrentPrevious Domicile FSR ICR Outlook/ Implications FSR ICR Outlook/ Implications Under Review Sagicor Financial Company Ltd.088130bbb- uDevelopingbbb-StableBermuda DowngradeSompo International Holdings Ltd.046709a-StableaStableBermuda Outlook: Positive, Negative, Stable. Implications: Positive, Negative, Developing. Business Type: P = Property/Casualty (Nonlife); L = Life; H = Health; T = Title; C = Composite. Opinion Modifiers: u = Under Review; sf = Structured Finance; i = Indicative Credit Rating Modifier; s = Syndicate Credit Rating Modifier71BEST’S REVIEW • NOVEMBER 2022 GUIDE TO BEST’S FINANCIAL STRENGTH RATINGS – (FSR) A Best’s Financial Strength Rating (FSR) is an independent opinion of an insurer’s financial strength and ability to meet its ongoing insurance policy and contract obligations. An FSR is not assigned to specific insurance policies or contracts and does not address any other risk, including, but not limited to, an insurer’s claims-payment policies or procedures; the ability of the insurer to dispute or deny claims payment on grounds of misrepresentation or fraud; or any specific liability contractually borne by the policy or contract holder. An FSR is not a recommendation to purchase, hold or terminate any insurance policy, contract or any other financial obligation issued by an insurer, nor does it address the suitability of any particular policy or contract for a specific purpose or purchaser. In addition, an FSR may be displayed with a rating identifier, modifier or affiliation code that denotes a unique aspect of the opinion. Best’s Financial Strength Rating (FSR) Scale Rating Categories Rating Symbols Rating Notches* Category Definitions Superior A+A++Assigned to insurance companies that have, in our opinion, a superior ability to meet their ongoing insurance obligations. ExcellentAA-Assigned to insurance companies that have, in our opinion, an excellent ability to meet their ongoing insurance obligations. GoodB+B++Assigned to insurance companies that have, in our opinion, a good ability to meet their ongoing insurance obligations. FairBB- Assigned to insurance companies that have, in our opinion, a fair ability to meet their ongoing insurance obligations. Financial strength is vulnerable to adverse changes in underwriting and economic conditions. MarginalC+C++ Assigned to insurance companies that have, in our opinion, a marginal ability to meet their ongoing insurance obligations. Financial strength is vulnerable to adverse changes in underwriting and economic conditions. WeakCC- Assigned to insurance companies that have, in our opinion, a weak ability to meet their ongoing insurance obligations. Financial strength is very vulnerable to adverse changes in underwriting and economic conditions. PoorD- Assigned to insurance companies that have, in our opinion, a poor ability to meet their ongoing insurance obligations. Financial strength is extremely vulnerable to adverse changes in underwriting and economic conditions. * Each Best’s Financial Strength Rating Category from “A+” to “C” includes a Rating Notch to reflect a gradation of financial strength within the category. A Rating Notch is expressed with either a second plus “+” or a minus “-”. Financial Strength Non-Rating Designations Designation Symbols Designation Definitions E Status assigned to insurers that are publicly placed, via court order into conservation or rehabilitation, or the international equivalent, or in the absence of a court order, clear regulatory action has been taken to delay or otherwise limit policyholder payments. F Status assigned to insurers that are publicly placed via court order into liquidation after a finding of insolvency, or the international equivalent. S Status assigned to rated insurance companies to suspend the outstanding FSR when sudden and significant events impact operations and rating implications cannot be evaluated due to a lack of timely or adequate information; or in cases where continued maintenance of the previously published rating opinion is in violation of evolving regulatory requirements. NR Status assigned to insurance companies that are not rated; may include previously rated insurance companies or insurance companies that have never been rated by AM Best. Rating Disclosure – Use and Limitations A Best’s Credit Rating (BCR) is a forward-looking independent and objective opinion regarding an insurer’s, issuer’s or financial obligation’s relative creditworthiness. The opinion represents a comprehensive analysis consisting of a quantitative and qualitative evaluation of balance sheet strength, operating performance, business profile and enterprise risk management or, where appropriate, the specific nature and details of a security. Because a BCR is a forward-looking opinion as of the date it is released, it cannot be considered as a fact or guarantee of future credit quality and therefore cannot be described as accurate or inaccurate. A BCR is a relative measure of risk that implies credit quality and is assigned using a scale with a defined population of categories and notches. Entities or obligations assigned the same BCR symbol developed using the same scale, should not be viewed as completely identical in terms of credit quality. Alternatively, they are alike in category (or notches within a category), but given there is a prescribed progression of categories (and notches) used in assigning the ratings of a much larger population of entities or obligations, the categories (notches) cannot mirror the precise subtleties of risk that are inherent within similarly rated entities or obligations. While a BCR reflects the opinion of A.M. Best Rating Services, Inc. (AM Best) of relative creditworthiness, it is not an indicator or predictor of defined impairment or default probability with respect to any specific insurer, issuer or financial obligation. A BCR is not investment advice, nor should it be construed as a consulting or advisory service, as such; it is not intended to be utilized as a recommendation to purchase, hold or terminate any insurance policy, contract, security or any other financial obligation, nor does it address the suitability of any particular policy or contract for a specific purpose or purchaser. Users of a BCR should not rely on it in making any investment decision; however, if used, the BCR must be considered as only one factor. Users must make their own evaluation of each investment decision. A BCR opinion is provided on an “as is” basis without any expressed or implied warranty. In addition, a BCR may be changed, suspended or withdrawn at any time for any reason at the sole discretion of AM Best. For the most current version, visit www.ambest.com/ratings/index.html. BCRs are distributed via the AM Best website at www.ambest.com. For additional information regarding the development of a BCR and other rating-related information and definitions, including outlooks, modifiers, identifiers and affiliation codes, please refer to the report titled “Guide to Best’s Credit Ratings” available at no charge on the AM Best website. BCRs are proprietary and may not be reproduced without permission. Copyright © 2022 by A.M. Best Company, Inc. and/or its affiliates. ALL RIGHTS RESERVED. Version 121719 LEVERAGE YOUR BEST’S CREDIT RATING WITH A BESTMARK FOR RATED INSURERS 21.MK101GA Showcase your financial strength with a BestMark icon on your website and promotional materials. Your Company Rating Our Insight, Your Advantage ™ www.ambest.com (908) 439-2200Best’s Credit Rating Actions 72BEST’S REVIEW • NOVEMBER 2022 GUIDE TO BEST’S ISSUER CREDIT RATINGS – (ICR) A Best’s Issuer Credit Rating (ICR) is an independent opinion of an entity’s ability to meet its ongoing financial obligations and can be issued on either a long- or short-term basis. A Long-Term ICR is an opinion of an entity’s ability to meet its ongoing senior financial obligations, while a Short-Term ICR is an opinion of an entity’s ability to meet its ongoing financial obligations with original maturities generally less than one year. An ICR is an opinion regarding the relative future credit risk of an entity. Credit risk is the risk that an entity may not meet its contractual financial obligations as they come due. An ICR does not address any other risk. In addition, an ICR is not a recommendation to buy, sell or hold any securities, contracts or any other financial obligations, nor does it address the suitability of any particular financial obligation for a specific purpose or purchaser. An ICR may be displayed with a rating identifier or modifier that denotes a unique aspect of the opinion. Best’s Long-Term Issuer Credit Rating (Long-Term ICR) Scale Rating Categories Rating Symbols Rating Notches* Category Definitions Exceptionalaaa-Assigned to entities that have, in our opinion, an exceptional ability to meet their ongoing senior financial obligations. Superior aaaa+ / aa-Assigned to entities that have, in our opinion, a superior ability to meet their ongoing senior financial obligations. Excellentaa+ / a-Assigned to entities that have, in our opinion, an excellent ability to meet their ongoing senior financial obligations. Goodbbbbbb+ / bbb-Assigned to entities that have, in our opinion, a good ability to meet their ongoing senior financial obligations. Fairbbbb+ / bb- Assigned to entities that have, in our opinion, a fair ability to meet their ongoing senior financial obligations. Credit quality is vulnerable to adverse changes in industry and economic conditions. Marginalbb+ / b- Assigned to entities that have, in our opinion, a marginal ability to meet their ongoing senior financial obligations. Credit quality is vulnerable to adverse changes in industry and economic conditions. Weakcccccc+ / ccc- Assigned to entities that have, in our opinion, a weak ability to meet their ongoing senior financial obligations. Credit quality is vulnerable to adverse changes in industry and economic conditions. Very Weakcc- Assigned to entities that have, in our opinion, a very weak ability to meet their ongoing senior financial obligations. Credit quality is very vulnerable to adverse changes in industry and economic conditions. Poorc- Assigned to entities that have, in our opinion, a poor ability to meet their ongoing senior financial obligations. Credit quality is extremely vulnerable to adverse changes in industry and economic conditions. * Best’s Long-Term Issuer Credit Rating Categories from “aa” to “ccc” include Rating Notches to reflect a gradation within the category to indicate whether credit quality is near the top or bottom of a particular Rating Category. Rating Notches are expressed with a “+” (plus) or “-” (minus). Best’s Short-Term Issuer Credit Rating (Short-Term ICR) Scale Rating Categories Rating Symbols Category Definitions StrongestAMB-1+Assigned to entities that have, in our opinion, the strongest ability to repay their short-term financial obligations. Outstanding AMB-1Assigned to entities that have, in our opinion, an outstanding ability to repay their short-term financial obligations. SatisfactoryAMB-2Assigned to entities that have, in our opinion, a satisfactory ability to repay their short-term financial obligations. AdequateAMB-3 Assigned to entities that have, in our opinion, an adequate ability to repay their short-term financial obligations; however, adverse industry or economic conditions likely will reduce their capacity to meet their financial commitments. QuestionableAMB-4 Assigned to entities that have, in our opinion, questionable credit quality and are vulnerable to adverse economic or other external changes, which could have a marked impact on their ability to meet their financial commitments. Long- and Short-Term Issuer Credit Non-Rating Designations Designation Symbols Designation Definitions dStatus assigned to entities (excluding insurers) that are in default or when a bankruptcy petition or similar action has been filed and made public. e Status assigned to insurers that are publicly placed, via court order into conservation or rehabilitation, or the international equivalent, or in the absence of a court order, clear regulatory action has been taken to delay or otherwise limit policyholder payments. fStatus assigned to insurers that are publicly placed via court order into liquidation after a finding of insolvency, or the international equivalent. s Status assigned to rated entities to suspend the outstanding ICR when sudden and significant events impact operations and rating implications cannot be evaluated due to a lack of timely or adequate information; or in cases where continued maintenance of the previously published rating opinion is in violation of evolving regulatory requirements. nrStatus assigned to entities that are not rated; may include previously rated entities or entities that have never been rated by AM Best. Rating Disclosure: Use and Limitations A Best’s Credit Rating (BCR) is a forward-looking independent and objective opinion regarding an insurer’s, issuer’s or financial obligation’s relative creditworthiness. The opinion represents a comprehensive analysis consisting of a quantitative and qualitative evaluation of balance sheet strength, operating performance, business profile and enterprise risk management or, where appropriate, the specific nature and details of a security. Because a BCR is a forward-looking opinion as of the date it is released, it cannot be considered as a fact or guarantee of future credit quality and therefore cannot be described as accurate or inaccurate. A BCR is a relative measure of risk that implies credit quality and is assigned using a scale with a defined population of categories and notches. Entities or obligations assigned the same BCR symbol developed using the same scale, should not be viewed as completely identical in terms of credit quality. Alternatively, they are alike in category (or notches within a category), but given there is a prescribed progression of categories (and notches) used in assigning the ratings of a much larger population of entities or obligations, the categories (notches) cannot mirror the precise subtleties of risk that are inherent within similarly rated entities or obligations. While a BCR reflects the opinion of A.M. Best Rating Services, Inc. (AM Best) of relative creditworthiness, it is not an indicator or predictor of defined impairment or default probability with respect to any specific insurer, issuer or financial obligation. A BCR is not investment advice, nor should it be construed as a consulting or advisory service, as such; it is not intended to be utilized as a recommendation to purchase, hold or terminate any insurance policy, contract, security or any other financial obligation, nor does it address the suitability of any particular policy or contract for a specific purpose or purchaser. Users of a BCR should not rely on it in making any investment decision; however, if used, the BCR must be considered as only one factor. Users must make their own evaluation of each investment decision. A BCR opinion is provided on an “as is” basis without any expressed or implied warranty. In addition, a BCR may be changed, suspended or withdrawn at any time for any reason at the sole discretion of AM Best. For the most current version, visit www.ambest.com/ratings/index.html. BCRs are distributed via the AM Best website at www.ambest.com. For additional information regarding the development of a BCR and other rating-related information and definitions, including outlooks, modifiers, identifiers and affiliation codes, please refer to the report titled “Guide to Best’s Credit Ratings” available at no charge on the AM Best website. BCRs are proprietary and may not be reproduced without permission. Copyright © 2022 by A.M. Best Company, Inc. and/or its affiliates. ALL RIGHTS RESERVED. Version 12171973BEST’S REVIEW • NOVEMBER 2022 Corporate Changes LIFE/HEALTH Name Changes American Labor Life Insurance Co. (AMB# 060390), Phoenix, AZ, USA. This company changed its name to Stellar National Life Insurance Co. on May 27, 2022. Assurant Life of Canada (AMB# 066882), Toronto, Ontario, Canada. This company changed its name to TruStage Life of Canada on Jan. 1, 2022. Prudential Annuities Life Assurance Corp. (AMB# 008715), Scottsdale, AZ, USA. This company changed its name to Fortitude Life Insurance & Annuity Co. on May 24, 2022. Vitality Health Plan of California Inc. (AMB# 062571), Cerritos, CA, USA. This company changed its name to CCA Health Plans of California Inc. on Jan. 5, 2022. Acquisitions & Ownership Changes American Labor Life Insurance Co. (AMB# 060390), Phoenix, AZ, USA. This company was acquired by Stellar National Holdings LLC from Tower Insurance Services Inc. on March 30, 2022. Wichita National Life Insurance Co. (AMB# 007248), Lawton, OK, USA. This company was acquired by Pillar Life Insurance Co. on June 10, 2022. Domiciliary Changes EquiTrust Life Insurance Co. (AMB# 060315), Scottsdale, AZ, USA. This company redomesticated to Arizona from Illinois on April 20, 2022. Mutual Trust Life Insurance Company, a Pan-American Life Insurance Group Stock Company (AMB# 006756), New Orleans, LA, USA. This company redomesticated to Louisiana from Illinois on July 13, 2022. PROPERTY/CASUALTY Merger Maison Insurance Co. (AMB# 014994), Baton Rouge, LA, USA. This company merged with and into FedNat Insurance Co. on Aug. 11, 2022. Name Changes Infinity Security Insurance Co. (AMB# 021432), Indianapolis, IN, USA. This company changed its name to TRM Specialty Insurance Co. on Sept. 8, 2022. Plans’ Liability Insurance Co. (AMB# 010597), Worthington, OH, USA. This company changed its name to Fortitude Casualty Insurance Co. on July 22, 2022. Poseidon Credit Insurance Co. (AMB# 001721), Charlotte, NC, USA. This company modified its Certificate of Authority to convert to a mortgage guaranty insurer and changed its name to Poseidon Mortgage Guaranty Co. on Jan. 5, 2022. Acquisition & Ownership Change Plans’ Liability Insurance Co. (AMB# 010597), Worthington, OH, USA. This company was acquired by Fortitude Group Holdings LLC from White Mountains Insurance Group Ltd. on May 12, 2022. Domiciliary Change Alestri Insurance Co. (AMB# 012240), Denver, CO, USA. This company redomesticated to Colorado from Washington on Jan. 10, 2022. BR Merger, Acquisitions and Ownership, Name and Domiciliary Changes Assurant Life of Canada, Wichita National Life Insurance and Maison Insurance are among the North American life/health and property/casualty insurers that have experienced a corporate change.74BEST’S REVIEW • NOVEMBER 2022 Preferred Publisher Program AM Best’s Preferred Publisher Participants In Other News ... A roundup of news from publishers around the globe. Access to some sites may require registration or subscription. Artemis | www.artemis.bm Q3 2022 Report – 9M issuance strong despite unusually quiet Q3 Asia Insurance Review | www.asiainsurancereview.com New Zealand: Earthquake resilience boosted by release of new hazard model Auto Insurance Report | https://riskinformation.com/ Regulators Seek Outside Expertise to Deal With More Complex Filings Benefits Pro | www.benefitspro.com/ Personal debt: It’s delaying 20% of Americans from saving for retirement Bermuda: Re+ILS | www.bermudareinsurancemagazine.com/ Regulation and the pursuit of excellence Business Insurance | www.businessinsurance.com Most Risk Managers Worry About Cyberattack: Survey Captive Insurance Times | www.captiveinsurancetimes.com/ Linking Up: The Advantages of the Insurance-Linked Securities Model and Its Relationship With Captives Captive International | www.captiveinternational.com/ IRS-Tennessee case may not set a precedent Carrier Management | www.carriermanagement.com Embedded Insurance Is the Future, ITC Panelists Say Claims Journal | www.claimsjournal.com/ Analysis: NFL isn’t Passing the Eye Test on Head Injuries Claims Magazine | propertycasualty360.com/claims-magazine/current-issue/ Insurance Fraud and Megayachts Commercial Risk | www.commercialriskonline.com/ Consistency of cross-border regulation key priority for Eiopa Commercial Risk Europe | www.commercialriskonline.com/cr-europe/ Concern grows that cyber won’t remain insurable risk Emerging Risks | https://emergingrisks.co.uk/ Ukraine War Will Hit Global Economies - World Bank Forbes Advisor | www.forbes.com/advisor/ Best Covid-19 Travel Insurance Plans of October 2022 Global Reinsurance | www.globalreinsurance.com/ London market still catching up on admin backlog caused by pre-pandemic ‘creaking systems’ Global Risk Manager | www.commercialriskonline.com/global-risk-manager/ New Zealand legislative changes to improve insurance-based levy system to fund fire services Health Payer Specialist | www.healthpayerspecialist.com/ Mapping America’s Payers Inside P&C | www.insidepandc.com/ Hurricane Ian: Will this loss be another turning point for the Florida market? Insurance & Investment Journal | https://insurance-portal.ca/ Claims inflation drives reinsurance pricing Insurance Age | www.insuranceage.co.uk/ FCA data shows 19% of BI insurance claimants still waiting for full payment Insurance Asset Risk | www.insuranceassetrisk.com/ Insurers have options against inflation, but concerns persist Insurance Insider | www.insuranceinsider.com/ FCA urges firms to improve governance, data and customer service after Covid BI review Insurance Journal | www.insurancejournal.com/magazines/ Atlantic City Casino Sued for Allegedly Paying Gambler to Keep Malfunctions Secret Insurance Post | www.postonline.co.uk/ Spotlight: Fraud – Will the cost-of-living crisis lead to more fraud? Insurance Times | www.insurancetimes.co.uk/ Workplace culture – should employers or employees adapt to create an inclusive environment? InsuranceERM | www.insuranceerm.com/ Plenty of runway left for life consolidation in Europe Intelligent Insurer | www.intelligentinsurer.com/ Cat bonds continue to exceed market expectations National Underwriter P/C | www.propertycasualty360.com/ national-underwriter-property-casualty/issue-gallery Future of Attracting and Retaining Agent Talent P&C Specialist | www.pandcspecialist.com/ Personal Lines Pros Go Incognito Online to Vent About Layoffs, Shake-ups Property Insurance Report | https://riskinformation.com/ Nevada Fired Up to Try Mitigation Incentives and Restrict Credit Use Reinsurance News | www.reinsurancene.ws/ Remediation is bearing fruit at Lloyd’s ahead of 1/1 filled with opportunity: LMA’s Davison Retirement Income Journal | https://retirementincomejournal. com/article/welcome-to-rijadvisor/ Why Annuity Issuers Use Bermuda Reinsurance Risk & Insurance | riskandinsurance.com/ 6 Workers’ Comp Issues Shaping the Regulatory Landscape Across the U.S. Risk.Net | www.risk.net/ US regulators step up enforcement of Dodd-Frank swap rules The Insurer | www.theinsurer.com/ Ian impact on ILS funds threatens retro availability at 1.1 Thompson’s World Insurance News | http://thompsonsnews.com/ Auto reforms promised in Ontario Trading Risk | https://www.trading-risk.com/ Hurricane Ian slashes cat bond values as some face significant losses Publications and sites listed above are participants in AM Best’s Preferred Publisher Program. www.ambest.com/sales/preferredpublisher75BEST’S REVIEW • NOVEMBER 2022 Insurance Professional Resources The Challenges of Catastrophic Claims Handling Additional coverage includes Marshall Dennehey’s celebration of 60 years in the industry and the addition of three attorneys at Secrest Wardle. Brian Schneider, RPA, and the president of Schneider & Associates Claims Services, a multi-line, independent adjusting company founded in 1993, based in California and with offices in several states, spoke with John Czuba, managing editor of Best’s Insurance Professional Resources, about catastrophic claims handling. Following is an edited transcript of the interview. What do you consider the greatest challenge as it pertains to the successful adjusting of catastrophic claims from the perspective of an independent, catastrophic adjusting company? It is ensuring that you have enough experienced adjusters who you’re familiar with, and they’ve proven themselves during prior seasons. The best adjusters are going to be pinged by multiple other CAT firms in the lead-up to a storm. You’re in open competition for a finite number of those folks. The best adjusters, from my perspective, are going to be attracted by three things. First, obviously, it’s the fee schedule. Now, most CAT adjusters are compensated based on a percentage of the fee. Firms will offer a higher percentage to attract the best talent, but percentages, they can often be misleading. Some IAs, in order to secure as many customers as possible, they’ll agree to work for what I would consider fees that are too low. A poor fee schedule will end up not attracting the type of adjusters who are going to produce the best work. What we try and do is work for companies that place an emphasis on the end product rather than the price, and who understand that the fee schedule has to be sufficient to support that end product. After compensation, it would be the process that you’ve put in place that the field adjusters have to work within. Even if the compensation looks excellent initially, if you burden your team with too much paperwork as a part of that, they find themselves spending way too much unproductive time dealing with the process and not turning claims. What do you consider the greatest challenge for the insurers when dealing with a catastrophic claim? It’s very much the same as with adjusting firms. It’s staffing, especially in the lead-up when the storm first hits. There’s the calm before the storm, literally. Then, all of a sudden, everything breaks loose, and call volume can overwhelm any insurer. The State Farms of the world, they can handle a spike because they’ve got all kinds of people, but medium-sized insurers, smaller insurers, boutique insurers trying to manage a tenfold increase in call volume, that’s very difficult. What a lot of insurers are going to do is they’re going to partner with firms that can take first loss reports, and, importantly, know how to manage an insured’s expectation. When the insured calls, they could be standing in a foot of water. It might be their first claim. They expect somebody at their house tomorrow, and that’s not going to happen with a large event. If you’re an insurer that is adept at doing it yourself or can partner with a company that knows how to take these first losses and manage insured’s expectations, it takes a lot of pressure off the insurer’s claims team and they can focus on processing claims rather than fielding calls. People forget that it’s the telephone that takes up almost more time than being in the field. If you don’t manage those calls in the beginning—that first wave of calls reporting claims—that is going to be dwarfed in a week or two by insureds calling, asking, “Hey, where’s my adjuster? Why hasn’t anyone come to see me?” Then, you’re paralyzed. It’s an avalanche. Setting your insured’s expectations, and following through on those expectations and your promises is critical. If you don’t, then that’s a recipe for a completely different kind of disaster. Also, reserving is a huge issue for insurers for obvious reasons. If you rely on a company that’s going to be in the field for you, whether it’s your own adjusters or it’s an IA like us, accurate reserves are critical. Many insurers, they’ll have preliminary reserves. They’re set, but once you’re in the field, communication with your field team to set updated reserves is very important. Where a lot of companies fall down, on the company side and on the IA side, is this bottleneck. You’ve got adjusters out climbing up on roofs or wading through water in basements, and they’re seeing 10, 15 risks a day. They see that for two weeks, and they don’t transmit reserves to anybody. All of a sudden, so then you’re getting reserves late. What we try to do to work around that is that our system—we have our adjusters send four overview photos and preliminary reserves by coverage to the desk adjuster before they even leave the loss location. That, at least, gets critical information to them in real time. What they do with it, that’s up to them. Some companies are better than others. That’s a very, very big challenge, is reserving. – John Czuba Brian Schneider AM Best Audio Visit www.bestreview.com to listen to the interview with Brian Schneider.76BEST’S REVIEW • NOVEMBER 2022 Insurance Professional Resources Marshall Dennehey Marks 60 Years in Business HERE’S TO 60 YEARS: Marshall Dennehey’s Philadelphia office celebrates the firm’s milestone anniversary. Front row, left to right: Gabrielle Simeone, senior payroll administrator; Christopher Santoro, shareholder; Butler Buchanan III, Philadelphia office managing attorney; Craig S. Hudson, executive committee member and director, professional liability department; G. Mark Thompson, president & CEO; and Howard P. Dwoskin, executive committee member, chairman, board of directors and director, casualty department. The civil defense litigation law firm has nearly 500 attorneys in 19 offices in seven states. Secrest Wardle Signs on Three Attorneys Secrest Wardle, a law firm specializing in defense litigation for insurance, municipal and commercial clients with headquarters in Troy, Michigan, and an additional office in Grand Rapids, recently announced the addition of three attorneys to its practice. Andrew S. Gipe joined the firm’s Troy location as an associate. Gipe is a member of the firm’s Motor Vehicle Litigation and Premises Liability Practice Groups. Prior to joining Secrest Wardle, Gipe worked as an associate attorney for a small firm where his practice focused in areas of trucking and insurance defense litigation. Meagan Hanna Stamell is now a partner in the Troy office. Stamell is a member of the firm’s Motor Vehicle Litigation and Premises Liability Practice Groups. Stamell has a decade of experience handling cases through all phases of litigation, most recently with the Oakland County prosecutor’s office. She has tried upward of 40 jury and bench trials to verdict. She is a retired member of the U.S. Coast Guard Auxiliary, where she served for 15 years. Stamell is an active member of the State Bar of Michigan and is a member of the Young Lawyers Section. Kyle C. Walton joined the Troy office as an associate. He is a member of the firm’s Motor Vehicle Litigation and Premises Liability Practice Groups. Walton previously practiced in Genesee County, where he assisted in the handling of more than 500 civil cases related to the Flint water crisis. Andrew S. Gipe Meagan Hanna Stamell Kyle C. Walton FIND THE ATTORNEY, ADJUSTER OR EXPERT SERVICE PROVIDER THAT FITS YOUR NEEDS WITH BEST’S INSURANCE PROFESSIONAL RESOURCES 22.BIPR064 Our Insight, Your Advantage ™ Learn More: www.ambest.com/professionalresources www.ambest.com • (908) 439-2200 For information about these firms and Best’s Insurance Professional Resources, visit www.claimsresource.ambest.com/ search/DirectoryCenter.aspx Photo courtesy of Marshall Dennehey77BEST’S REVIEW • NOVEMBER 2022 Industry UpdatesIndustry Updates Industry Experts Say Litigated Claims Could Reshape Florida Market Again Nationally, 9% of claims are filed in Florida, but 81% of litigated claims, or 107,000, originated in the state in 2021. T he Insurance Information Institute estimates that litigation expenses will add $10 billion to $20 billion to Hurricane Ian claim costs, in part because of the low rate of homes insured against flood losses, said spokesman Mark Friedlander. Despite recent legislative efforts to curb their misuse, assignment of benefits and litigation practices in Florida are expected to impact loss severity, “especially in cases where coverage leakage of water losses onto wind-only policies is likely,” said Rajkiran Vojjala, model development vice president at RMS. In a state wrapped on three sides by “two of the largest bodies of water in the world,” Friedlander said the take-up rate for residential flood insurance— primarily through the National Flood Insurance Program—is 18%. That’s higher than in any other state, but also means that more than 80% of Florida residents forgo the coverage. And take- up rates inland are just 2% to 3% where Ian continued to cause catastrophic flooding after making landfall Sept. 28 in Lee County on the Gulf Coast, said the Florida resident. “There will be significant dispute over whether homeowners suffered windstorm versus flood losses,” Friedlander said. These expenses, not the cost of property repairs, rebuilding and replacements, is what will drive more small, regional carriers out of business, he added. U.S. insurers incurred an estimated $53 billion to $74 billion of losses and a sizable portion will come on post-event loss amplification and economic and social inflation, according to Vojjala. “Social inflation factors will lead to complex and lengthy claims settlement processes in this event, amplifying loss adjustment expenses and corresponding claim costs,” Vojjala said. “A sizable portion of the losses from Ian will be associated with post-event loss amplification and inflationary trends. A combination of high claims volume, additional living expenses related to the massive evacuation efforts, prolonged reconstruction in the worst-affected areas, and the prevalent higher- than-average construction costs will contribute to a significant economic demand surge,” Vojjala concluded. Nationally, 9% of claims are filed in Florida, but 81% of litigated claims, or 107,000, originated in Florida in 2021, Friedlander said. The next closest was California, where 3,600 claims were litigated. Pre-Ian, III projected that the number of litigated claims in the Sunshine State would rise to 130,000 this year. “Now we don’t know” how high that number could climb, Friedlander said. He pondered how many more P/C insurers would exit homeowners lines in Florida or become insolvent in the coming 18 months. “Every single company says the same thing, they cannot operate in a litigious environment. Legislators have not taken strong enough action to disincentivize the high level of litigation.” Six P/C carriers were declared insolvent this year, on the heels of two insolvencies attributed to abusive legal practices, related to roof claims. Wells Fargo Securities LLC Equity Analyst Elyse Greenspan and associates think Ian’s auto losses could be outsized, layering on top of “an environment where loss costs are already in the double digits and car valuations are near record highs.” Her team projects auto losses in the range of $5 billion to $6 billion, higher than the $3 billion from extreme flooding event Hurricane Harvey in 2017 in Texas. In an equity research note, Greenspan estimated that Progressive Corp. may have incurred $1.15 billion of catastrophe losses in September. Progressive’s surplus at the end of the second quarter totaled $16.6 billion and “could go lower in Q3 given the losses and downturn in its equity portfolio,” the note said. “Right now we are including $800 million of personal auto losses, $104 million of commercial lines losses, and $230 million of homeowners losses for the month of September … of which the main event should be Hurricane Ian. Progressive does not have reinsurance on its personal auto book, while it does have reinsurance for its property book,” Wells Fargo’s analysts said. —Renée Kiriluk-Hill “There will be significant dispute over whether homeowners suffered windstorm versus flood losses.” Mark Friedlander Insurance Information InstituteNext >