A.M. Best has assigned a financial strength rating of “A- (Excellent)” and an issuer credit rating of "a-” to Radnor Specialty Insurance Company of Wayne, Pennsylvania. The outlook assigned to both ratings is stable.
According to the agency, the ratings reflect Radnor Specialty's “favourable” level of risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio, the experience of the management team and its “targeted” business plan.
A.M. Best stated: “These ratings benefit from the support Radnor Specialty will receive from an affiliated company, United States Liability Insurance Company and its ultimate parent, Berkshire Hathaway.”
Partially offsetting these positive rating factors are the inherent concerns the A.M. Best has with the company's profile as a start-up, with regard to marketing, pricing, reserving, loss experience and growth potential.
The rating could be upgraded after the initial development period through better than expected underwriting performance, stronger than planned overall operating income, or significant gains in risk-adjusted capital position.
A.M. Best has confirmed that the rating could also be impacted negatively from growth outpacing risk-adjusted capital or operational structure, less than optimal loss experience or failure to reach sustainable levels of premium.
Radnor Specialty is a wholly owned subsidiary of Mount Vernon Specialty Insurance Company, also of Wayne, Pennsylvania. These two companies are positioned under the Devon Park Specialty Insurance business unit.
