A.M. Best has affirmed the financial strength rating of A- (Excellent) and the issuer credit rating of “a-” of Ardellis Insurance. The outlook for both ratings is stable.
The ratings of Ardellis reflect its conservative underwriting leverage, strong level of capitalisation and profitable operating results driven by its excellent underwriting performance.
Partially offsetting these positive rating factors are Ardellis’ relatively high retention and limited profile as a single parent captive of Universal Forest Products (UFP).
Ardellis provides coverage for general liability, auto liability, workers’ compensation, property and medical stop loss, and has maintained conservative underwriting leverage ratios as surplus has remained strong to support its business volume.
The company has posted low loss and loss adjustment expense ratios, reflecting its effective risk management practices. The ratings also recognise Ardellis’ balance sheet strength and conservative underwriting leverage measures.
Although the outlook for the ratings is stable and not expected to be revised within the next 12 to 24 months, factors that could lead to a positive outlook and/or an upgrading of Ardellis’ ratings are material and sustained improvement in its underwriting performance and capitalisation.
Factors that could lead to a negative outlook and/or a downgrading of the ratings are material deterioration of capital from the company’s claims, investments and/or a reduced level of capital that does not support its ratings as measured by Best’s Capital Adequacy Ratio (BCAR).
