A.M. Best Affirms Credit Ratings of Selective Insurance Group, Inc. and Its Subsidiaries
September 08 2017 - 9:24AM
Business Wire
A.M. Best has affirmed the Financial Strength Rating
(FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings
(Long-Term ICR) of “a+” of the ten pooled members of Selective
Insurance Group (Selective). In addition, A.M. Best has
affirmed the Long-Term ICR of “bbb+” and the Long-Term Issue Credit
Ratings (Long-Term IR) of the ultimate parent, Selective
Insurance Group, Inc. (SIGI) [NASDAQ: SIGI]. The outlook of
these Credit Ratings (ratings) is stable. All companies are
headquartered in Branchville, NJ. (Please see below for a detailed
listing of companies and ratings.)
The ratings reflect the group’s strong level of risk-adjusted
capitalization, improved operating performance since 2012 and high
policy retention rate across its standard lines of business. These
positive attributes are driven by the group’s experienced
management team, disciplined underwriting with the use of
sophisticated predictive analytic modeling tools and efficient
claims handling. The ratings also consider Selective’s favorable
market presence, as it ranks as the 36th largest property/casualty
insurance writer in the United States based on 2016 net premiums
written.
The positive rating factors are offset partly by Selective’s
lower net investment yield compared with that of the commercial
casualty composite over the past five years, and that is due mainly
to Selective’s more conservative investment stance. In addition,
the group has an elevated level of operating leverage relative to
the composite.
SIGI’s adjusted debt-to-total capital ratio of 22% at year-end
2016 and 21% at June 30, 2016, were well-within A.M. Best’s
guidelines for the company’s ratings. In addition, SIGI’s interest
coverage ratio was more than adequate for its assigned ratings.
The FSR of A (Excellent) and the Long-Term ICRs of “a+” have
been affirmed for the pooled members of Selective Insurance
Group:
- Selective Insurance Company of
America
- Selective Way Insurance
Company
- Selective Insurance Company of the
Southeast
- Selective Insurance Company of New
York
- Selective Insurance Company of South
Carolina
- Selective Insurance Company of New
England
- Selective Auto Insurance Company of
New Jersey
- Mesa Underwriters Specialty
Insurance Company
- Selective Casualty Insurance
Company
- Selective Fire & Casualty
Insurance Company
The following Long-Term IRs have been affirmed:
Selective Insurance Group, Inc.—
--“bbb+” on $49.9 million 7.25% senior unsecured notes, due
2034
--“bbb+” on $99.4 million 6.70% senior unsecured notes, due
2035
--“bbb+” on $185.0 million 5.875% senior unsecured notes, due
2043
The following indicative Long-Term IRs on the shelf registration
have been affirmed:
Selective Insurance Group, Inc.—
--“bbb+” on senior unsecured debt
--“bbb” on subordinated debt
--“bbb-” on preferred stock
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 the world’s oldest and most authoritative
insurance rating and information source. For more information,
visit www.ambest.com.
Copyright © 2017 by A.M. Best Rating
Services, Inc. and/or its subsidiaries. ALL RIGHTS
RESERVED.
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version on businesswire.com: http://www.businesswire.com/news/home/20170908005480/en/
A.M. BestCarl Altenburg, +1-908-439-2200, ext.
5213Senior Financial
Analystcarl.altenburg@ambest.comorJacqalene Lentz,
CPA, +1-908-439-2200, ext.
5762Directorjacqalene.lentz@ambest.comorChristopher
Sharkey, +1-908-439-2200, ext. 5159Manager, Public
Relationschristopher.sharkey@ambest.comorJim Peavy,
+1-908-439-2200, ext. 5644Director, Public
Relationsjames.peavy@ambest.com
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