A.M. Best Affirms Ratings of Repwest Insurance Company
A.M. Best Affirms Ratings of Repwest Insurance Company
OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has affirmed the financial strength rating of B (Fair) and issuer credit rating of "bb+" of Repwest Insurance Company (Repwest) (Phoenix, AZ). The outlook for both ratings is stable. Repwest is a wholly owned subsidiary of AMERCO (Reno, NV) [NASDAQ:UHAL], a publicly- traded holding company. AMERCO also is the parent of U-Haul International, Inc (U-Haul), North America's leading "do-it-yourself" moving and storage operator.
The ratings reflect Repwest's unfavorable underwriting performance in the majority of its last five years, primarily due to adverse loss reserve development associated with its discontinued excess workers' compensation business as well as the company's historically high cost structure. Most notably, in 2011, Repwest's substantial reserve strengthening for its excess workers' compensation resulted in a reduction in policyholder surplus and a notable deterioration in its results that year.
These rating factors are offset by Repwest's adequate level of risk-adjusted capitalization and favorable accident year operating performance, following management's decision to focus strictly on U-Haul-related business. Furthermore, in 2012, net income of close to $17 million was generated, resulting in significantly improved operating return measures for the year. The stable outlook acknowledges A.M. Best's expectations that Repwest will continue to maintain a supportive level of risk-adjusted capital.
Future negative rating actions could result if there is a deterioration in Repwest's underwriting performance or a significant decline in its capital strength as measured by Best's Capital Adequacy Ratio (BCAR).
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visitwww.ambest.com.
Copyright © 2013 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.
A.M. Best Company
Adrienne Tortoriello
Senior Financial Analyst
(908) 439-2200, ext. 5088
adrienne.tortoriello@ambest.com
or
Jennifer Marshall
Managing Senior Financial Analyst
(908) 439-2200, ext. 5327
jennifer.marshall@ambest.com
or
Rachelle Morrow
Senior Manager, Public Relations
(908) 439-2200, ext. 5378
rachelle.morrow@ambest.com
or
Jim Peavy
Assistant Vice President, Public Relations
(908) 439-2200, ext. 5644
james.peavy@ambest.com
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