AM Best Upgrades Credit Ratings of ClearPath Following Merger With Harford

AM Best has upgraded the Financial Strength Rating (FSR) to A (Excellent) from A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “a” (Excellent) from “a-” (Excellent) of ClearPath Insurance Co., which does business as ClearPath Specialty and ClearPath Specialty Insurance Co. The outlook of these Credit Ratings (ratings) has been revised to stable from positive.

The upgrades come following workers’ compensation insurer ClearPath’s merger with Maryland’s Harford Mutual Insurance Group last August.

AM Best said the rating upgrades and the revised outlooks for ClearPath Specialty reflect its integration as a newly added reinsured member of Harford Mutual Insurance Group. Also, the ratings reflect ClearPath Specialty’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile, and appropriate enterprise risk management.

Harford Mutual Completes Merger With Workers’ Compensation Writer ClearPath

ClearPath Specialty’s ratings were placed under review with positive implications in March 2023, following the announcement of its intent to with Harford Mutual.

The Maryland Insurance Administration approved Harford Mutual’s merger with ClearPath Specialty, effective August 4, 2023. Following the announcement, the ratings were removed from under review and an FSR of A- (Excellent) and a Long-Term ICR of “a-” (Excellent) were affirmed with positive outlooks. As part of the transaction, ClearPath Specialty converted to a stock insurance company from a mutual company. Thereafter, it became a wholly owned direct subsidiary of Harford Mutual Insurance Co. effective November 13, 2023, and via a 100% quota share reinsurance agreement effective January 1, 2024.

ClearPath Mutual, formerly KESA of Kentucky for 40 years, was formed in 2018 and provides monoline workers’ compensation coverage in Indiana, Kentucky, Georgia, Tennessee, and West Virginia. ClearPath Mutual writes more than $52 million in direct written premium across nearly 7,000 policies.

ClearPath Mutual’s current home office in Louisville will remain in place and serve as Harford Mutual’s Midwest office. Harford’s main office is in Bel Air, Maryland.

Harford Mutual Insurance Group, founded in 1842 in Harford County, Maryland, provides commercial property/casualty insurance to a regional market. Harford Mutual ended 2022 with $327 million in direct written premium sold through independent agents in 10 states and Washington, D.C.

Topics Mergers & Acquisitions AM Best Maryland