A.M. Best has affirmed the financial strength rating of “A (Excellent)” and the long-term issuer credit rating of “a+” of Nuclear Electric Insurance Limited (NEIL).
According to A.M. Best, the ratings reflect NEIL’s marginal operating performance, favourable business profile and appropriate enterprise risk management.
NEIL provides essentially the entire nuclear utility property insurance coverage in the US.
The rating agency noted that partially offsetting these positive rating factors are the company’s primary focus on catastrophe property risks and related business interruption claims, with the subsequent financial stress this could cause in the unlikely event of two full-limit losses.
A.M. Best said: “Despite the recent positive results, the company has reported volatility in underwriting results in recent years due to claims activity, which relates to the fact that the company relies on one market and two principal product lines.”
However, it stated that these factors are reflective of a captive insurer focused on a particular niche market supported by its members.
NEIL’s risk management programme is designed to manage risks within the company’s defined tolerance levels, in addition to a loss prevention programme.