AM Best has assigned a financial strength rating of “A-” (Excellent) and a long-term Issuer credit rating of “a-” (Excellent) to Relsure Vermont. The outlook assigned to these credit ratings is stable. Relsure is a captive insurance company wholly-owned by The Related Companies, LP (Related), a New York-based limited partnership engaging in real estate operations. Relsure provides general liability and workers’ compensation coverage through Related’s owner controlled insurance programmes and property coverage. The ratings reflect Relsure’s balance sheet strength, which AM Best assesses as “very strong”. The firm’s adequate operating performance, limited business profile and appropriate enterprise risk management were also noted. Relsure’s level of risk-adjusted capitalisation, as measured by the rating company’s capital adequacy ratio, is assessed at the strongest level, where the ratings company expects it to remain. The balance sheet strength assessment also considers the company’s conservative investment strategy, solid liquidity measures and favourable loss reserve development over the last five years. Relsure’s adequate operating performance assessment also reflects favourable revenue measures that outperform AM Best’s commercial casualty composite. The ratings company says Relsure’s operating performance reflects the inherent benefits of being a captive insurer as it has minimal acquisition costs and administrative expenses, driving its favourable expense ratio. In addition, the parent’s risk management practices, which include best-in-class safety and loss control programmes, play a key role in the captive’s loss experience. This has shown improvement in recent years.
