AM Best upgrades the financial strength rating of National Guaranty Insurance Company of Vermont (NGIC) to ‘A’ (Excellent) and its long-term issuer credit rating to ‘a’ (Excellent), with ‘stable’ outlook. The insurer serves as the captive of Waste Management, a major provider of environmental services across North America. The upgrade reflects AM Best’s reassessment of NGIC’s operating performance to ‘very strong’ from ‘strong’, driven by a consistent track record of underwriting profitability and robust return on revenue metrics. Over the past decade, NGIC has achieved combined ratios that significantly outperform the industry average and peer group. The rating agency expects this strong performance to continue, supported by the captive’s rigorous loss control measures and loss-free claims history. NGIC’s balance sheet strength is assessed as ‘very strong’, and the captive is recognised for its appropriate enterprise risk management and limited, but focused, business profile. As an integral component of Waste Management’s enterprise risk management (ERM) programme, NGIC is fully capitalised by the parent through a demand note, with additional capital support provided via letters of credit when needed. NGIC also benefits from Waste Management’s sophisticated risk management strategies, which enhance its ability to support a portion of the group’s financial assurance programme. The company is licensed in two US states and operates as a non-admitted insurer in 27 states, serving the financial assurance needs of its parent. AM Best notes that NGIC’s enterprise risk management framework is appropriate for a focused captive and effectively aligned with policyholder interests. The stable outlook reflects confidence that NGIC will maintain its superior operating performance and strong balance sheet position over the medium term.
