Market Overview

A.M. Best Affirms Credit Ratings of United States Liability Insurance Company and Its Subsidiaries


A.M. Best has affirmed the Financial Strength Rating of A++
(Superior) and the Long-Term Issuer Credit Ratings of "aa+" of United
States Liability Insurance Company (USLI) (Wayne, PA) and its
subsidiaries: Mount Vernon Fire Insurance Company (MVF) (Wayne, PA),
U.S. Underwriters Insurance Company (USU) (Bismarck, ND), Mount Vernon
Specialty Insurance Company and Radnor Specialty Insurance
Company (both domiciled in Omaha, NE). The outlook of these Credit
Ratings (ratings) is stable.

The ratings of the insurance operating companies reflect its balance
sheet strength, which A.M. Best categorizes as strongest, as well as its
very strong operating performance, neutral business profile and
appropriate enterprise risk management. These pillars can be seen in
USLI's extended trends of underwriting and operating profitability,
superior risk-adjusted capital position, very strong market presence and
conservative reserve positions. Additional positive rating factors
include exceptional diversification in their books of business as it
regards limiting concentration; proactive claims management philosophy;
and commitment to customer service. Furthermore, the companies have
extensive employee training and retention programs that translate into a
strong corporate culture of success.

Furthermore, these ratings continue to benefit from implicit support
provided to USLI and its subsidiaries by their ultimate parent,
Berkshire Hathaway Inc. (Berkshire) (NYSE:BRK), and
explicit support from their affiliate, National Indemnity Company.

This support for some of the operating companies is in the form of
significant reinsurance treaties with National Indemnity Company, a
Berkshire subsidiary. In addition to this agreement, Berkshire has
established an extended track record of supporting its member companies.

These positive rating factors are partially offset by the above-average
investment leverage recorded by the group, which could be affected by
sudden adverse changes in market conditions. Additionally, the ratings
could be impacted negatively in the long term if operating performance
falls markedly short of A.M. Best's expectations, including a
significant deterioration in loss trends, material disruptions of its
business strategy, sudden declines in policyholders' surplus or asset or
liquidity losses related to investment activity. The ratings also could
be impacted negatively as a result of sudden adverse changes in market
conditions across a large portion of the book of business or extreme
shifts in claims severity and frequency trends. Because of the rating
support received from Berkshire, and reinsurance provided by the sister
company, National Indemnity Company, changes in the ratings or outlooks
of the associated companies may impact the ratings of USLI.

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
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases

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