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A.M. Best Revises Outlooks to Positive for Members of Optimum General Companies

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A.M. Best has revised the outlooks to positive from stable and
affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the
Long-Term Issuer Credit Ratings (Long-Term ICR) of "a-" of the members
of Optimum General Companies (Optimum General). Optimum General
consists of Optimum Insurance Company Inc. (Montreal, Quebec), Optimum
West Insurance Company Inc.
(Burnaby, British Columbia) and Optimum
Farm Insurance Inc.
(Trois-Rivieres, Quebec).

The outlook change to positive for the members of Optimum General
reflect the sustained stability in pre-tax operating earnings driven by
underwriting income that outperforms the property industry composite
over the long term.

The ratings of Optimum General reflect its balance sheet strength, which
A.M. Best categorizes as very strong, as well as its adequate operating
performance, limited business profile and appropriate enterprise risk
management (ERM).

The rating affirmations for the members of Optimum General reflect the
very strong risk-adjusted capitalization as measured by Best's Capital
Adequacy Ratio (BCAR) with scores at the 99.6% level somewhat offset by
the elevated underwriting leverage measures. The group has reported that
adequate pre-tax operating earnings have outperformed the property
industry composite over the most-recent five-year period, with operating
earnings driven and augmented by underwriting income. The limited
business profile reflects Optimum General's geographic concentration
primarily in three provinces, writing personal, commercial, automobile
and farming risks with solid brand name recognition.

Factors that could lead to positive rating actions include sustained
improvement in operating results at a level that outperforms other
similarly rated peers while maintaining the strongest level of
risk-adjusted capitalization. Negative rating actions may occur should
adverse reserve development result in a deterioration of the group's
risk-adjusted capitalization to a level that is not in line with A.M.
Best's expectations. Negative rating actions may occur should operating
results deteriorate to a level that trails similarly rated peers due to
a weakening in underwriting performance.

A.M. Best previously revised the outlooks to positive from stable and
affirmed the FSR of A- (Excellent) and the Long-Term ICR of "a-" for Optimum
Re Insurance Company
(Dallas, TX) and Optimum Reassurance Inc.
(Montreal, QC) (collectively referred to as Optimum Re). (See related
press release
.)

This press release relates to Credit Ratings that have been published
on A.M. Best's website. For all rating information relating to the
release and pertinent disclosures, including details of the office
responsible for issuing each of the individual ratings referenced in
this release, please see A.M. Best's
Recent
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Understanding
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
Guide
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases
.

A.M. Best is a global rating agency and information provider with a
unique focus on the insurance industry. Visit
www.ambest.com
for more information
.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its
affiliates. ALL RIGHTS RESERVED.

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