AM Best at revised the outlook from stable to negative and affirmed the financial strength rating of A- (Excellent) and the issuer’s long-term credit rating of “a-” (Excellent) of
The credit ratings (ratings) reflect the strength of SafePort’s balance sheet, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate management of business risks.
The negative outlook reflects deteriorating operational performance in recent years, particularly relative to the current adequate valuation. The recent deterioration is primarily due to high catastrophic losses caused by Hurricane Laura in 2020 and Winter Storm Uri and Hurricane Ida in 2021. Although management has taken steps to stabilize results, the ultimate effectiveness of the return performance at historic standards is uncertain.
The negative outlook also reflects the potential for pressure on the assessment of balance sheet strength given further premium growth and related statutory pressure. Until recently, SafePort was a relatively inactive solution
AM Best will continue to monitor the execution of near-term plans communicated by management and their impact on reducing pressure on SafePort’s operational performance, as well as the company’s plan for potential bonus growth.
This press release relates to credit ratings that have been published on AM Best’s website. For all rating information relating to the release and relevant disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For more information on the use and limitations of credit rating opinions, please see Best’s Guide to Credit Ratings. For more information on the proper use of Best’s Credit Scores, Best’s Preliminary Credit Scores, and AM Best’s press releases, please see Guide to the Proper Use of Best Scores and Ratings.
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Source: AM Best