A.M. Best has affirmed the financial strength rating (FSR) of "A- (Excellent)" and the issuer credit rating (ICR) of “a-” to Bearing Midwest Casualty Company and Horizon Midwest Casualty Company, both domiciled in Lenexa, Kansas.
The ratings reflect Bearing and Horizon’s sound business plans, supportive risk-based capitalisation and strong reinsurance protection.
Partially offsetting the positive ratings is the start-up nature of Bearing and Horizon, limited market scope and the potential impact of continued soft market conditions.
A.M Best also assigned the FSR of A- (Excellent) and ICR of “a-” to Horizon and Bearing’s parent company, Midwest Builders’ Casualty Mutual Company (MWBC).
MWBC’s ratings reflect its strong operating performance, aggressive claims management and solid capitalisation.
Partially offsetting the ratings is MWBC’s product concentration as a monoline workers’ compensation writer, which potentially exposes it to increased risk of regulatory or legislative changes and challenging market conditions in the workers compensation line of business.
“While the outlook is stable, positive movement on all three companies’ ratings are unlikely in the near to medium term. However, negative rating actions could occur if risk-adjusted capitalisation were to deteriorate as a result of dividend payments and investment losses. A deterioration of the companies’ market share and competitive position may also put negative pressure on the ratings,” said a statement from the rating firm.
