AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” (Excellent) of Topa Insurance Co. in Calabasas, Calif. and its subsidiary, Dorchester Insurance Company Ltd. in the U.S. Virgin Islands).
These companies, collectively referred to as Topa Insurance Group, are wholly owned subsidiaries of Topa Equities Ltd.
The ratings reflect Topa’s balance sheet strength, which AM Best assessed as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
The AM Best ratings consider Topa’s very strong balance sheet strength, inclusive of an adverse development cover that has provided a level of protection against adverse reserve development on the entire base of accident-year 2018 and prior loss reserves, as well as adequate operating performance evidenced in part by profitability on a five-year average basis and limited business profile as a specialty writer focused primarily on commercial lines and niche market program business.
“The revision of the outlooks to stable reflects AM Best’s expectation that Topa will maintain its improved level of operating performance on continuing business over the intermediate term, which will help to absorb the potential for further adverse development in the commercial auto liability line, while continuing to benefit from expense controls and increased operating efficiencies from the upgrade of core systems,” AM Best stated. “The outlook revisions further reflects a number of strategic business initiatives and underwriting actions taken by management in recent years to improve profitability, which include purchasing the ADC, effective Jan. 1, 2019, exiting underperforming business and undesirable classes, implementing rate increases where appropriate, aggressively managing tail risk and building business in core programs.”
Topics California Trends AM Best
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