A.M. Best has affirmed the financial strength rating of “A (Excellent)” and the long-term issuer credit rating of “a” of Palms Insurance Company, the wholly owned captive insurer of NextEra Energy Capital, a subsidiary of NextEra Energy, an American energy company.
The ratings reflect the captive’s strong integration within the risk management structure of its parent, NextEra Energy Capital, according to A.M. Best.
Partially offsetting these positive rating factors are Palms’ limited market scope and high net loss potential stemming from a single, severe occurrence relative to surplus, according to the ratings agency.
However, this is mitigated by the company’s “excellent loss history, favourable geographic spread of risk and the history of support of Palms’ strong surplus position by its parent”.
The captive only accepts insurance risks from NextEra Energy and its affiliates, providing specialised direct and assumed property and casualty coverages, workers’ compensation, automobile liability, employers’ liability and property risk.
