AM Best Affirms Credit Ratings of The Hanover Insurance Group, Inc. and Its Subsidiaries
June 21 2022 - 4:21PM
Business Wire
AM Best has affirmed the Financial Strength Rating (FSR)
of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term
ICR) of “a+” (Excellent) of the property/casualty subsidiaries of
The Hanover Insurance Group, Inc. (THG) [NYSE: THG], which are
collectively referred to as The Hanover. Additionally, AM Best has
affirmed the Long-Term ICR of “bbb+” (Good) and all Long-Term Issue
Credit Ratings (Long-Term IR) of THG, which is the parent holding
company. The outlook of these Credit Ratings (ratings) is stable.
All companies are headquartered in Worcester, MA. (See below for a
detailed listing of the companies and ratings.)
The ratings reflect The Hanover’s balance sheet strength, which
AM Best assesses as strongest, as well as its adequate operating
performance, favorable business profile and appropriate enterprise
risk management (ERM).
The assessment of the group’s balance sheet strength is based on
its risk-adjusted capitalization, which is at the strongest level,
as measured by Best’s Capital Adequacy Ratio (BCAR). The assessment
of the group’s balance sheet strength also reflects its stable loss
reserve position, comprehensive reinsurance program and the
benefits from the additional financial flexibility available
through its ultimate parent, THG. Balance sheet strength is
somewhat offset by exposure to catastrophe and terrorism events.
Additionally, the ratings of The Hanover reflect the group’s
improvement in underwriting profitability over the past five years.
The ratings also consider the group’s sound business profile and
diversified product offerings, especially within its commercial and
specialty lines of business. The Hanover’s business profile
assessment reflects its strong market position, as it ranks among
the top 25 U.S. property/casualty organizations and holds a leading
position in many of its targeted market niches, along with its
experienced management team. The group’s product range includes
personal lines, core commercial offerings and specialty coverages,
with business expansion supported by strong relationships with its
independent agency partners. The Hanover has implemented an
appropriately designed and embedded ERM program to address the
organization’s risks. A formal framework is in place, and the
continual evaluation and monitoring of key risks and tolerances is
well-established.
The FSR of A (Excellent) and the Long-Term ICRs of “a+”
(Excellent) has been affirmed with stable outlooks for the
following subsidiaries of The Hanover Insurance Group, Inc.:
- AIX Specialty Insurance Company
- Allmerica Financial Alliance Insurance Company
- Allmerica Financial Benefit Insurance Company
- Campmed Casualty & Indemnity Company, Inc.
- Citizens Insurance Company of America
- Citizens Insurance Company of Ohio
- Citizens Insurance Company of the Midwest
- Citizens Insurance Company of Illinois
- The Hanover American Insurance Company
- The Hanover Atlantic Insurance Company, Ltd.
- The Hanover Insurance Company
- The Hanover Casualty Company (formerly known as Hanover Lloyd’s
Insurance Company)
- The Hanover New Jersey Insurance Company
- Massachusetts Bay Insurance Company
- NOVA Casualty Company
- Verlan Fire Insurance Company
The following Long-Term IRs have been affirmed with a stable
outlook:
The Hanover Insurance Group, Inc.— -- “bbb+” (Good) on $199.5
million 7.625% senior unsecured debentures, due 2025 (of which
$61.8 million remains outstanding) -- “bbb+” (Good) on $375.0
million 4.5% senior unsecured fixed rate notes, due 2026 -- “bbb-”
(Good) on $165.7 million 8.207% subordinated deferrable debentures,
due 2027 (of which $50.1 million remains outstanding) -- “bbb+”
(Good) on $300 million 2.5% senior unsecured notes, due 2030
The following indicative Long-Term IRs under the shelf
registration have been affirmed with a stable outlook:
The Hanover Insurance Group, Inc.— -- “bbb+” (Good) on senior
unsecured debt -- “bbb-” (Good) on subordinated debt -- “bbb-”
(Good) on preferred stock
This press release relates to Credit Ratings that have been
published on AM 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 AM Best’s Recent
Rating Activity web page. For additional information
regarding the use and limitations of Credit Rating opinions, please
view Guide to Best's Credit Ratings. For information
on the proper use of Best’s Credit Ratings, Best’s Performance
Assessments, Best’s Preliminary Credit Assessments and AM Best
press releases, please view Guide to Proper Use of Best’s
Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
Copyright © 2022 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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Edin Imsirovic Associate Director +1 908 439 2200,
ext. 5740 edin.imsirovic@ambest.com
Christopher Sharkey Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com
Rosemarie Mirabella Director +1 908 439 2200,
ext. 5892 rosemarie.mirabella@ambest.com
Jeff Mango Managing Director, Strategy &
Communications +1 908 439 2200, ext. 5204
jeffrey.mango@ambest.com
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