OLDWICK, New Jersey, November 19, 2021– (COMMERCIAL THREAD) –AM Best has placed under review with negative implications the financial strength rating of A (excellent) and the issuer’s long-term credit rating of âaâ (excellent) of Golden Bear Insurance Company (Golden Bear) (Stockton, CA ).
Golden Bear’s credit ratings have come under review with negative implications reflecting the surplus erosion seen in 2021, for which management has released corrective action plans in response. In the first nine months of 2021, the company recorded approximately $ 12 million of adverse claims reserves, primarily related to claims that have been adversely affected by social inflation factors, as well as claims activity. higher than expected in some programs and geographic areas. . Unfavorable development is the main volatility factor leading to an 8.2% ($ 6 million) decrease in surplus during the year. Management has presented plans to replenish short-term capital losses, which are expected to strengthen the company’s risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR), and therefore overall strength. of the balance sheet. Ratings will remain under review until management takes action, and AM Best assesses the impact on Golden Bear.
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