AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of 'a-' (Excellent) of Illinois Casualty Company (ICC).
Concurrently, AM Best affirmed the Long-Term ICR of 'bbb-' (Good) of ICC Holdings, Inc. [NASDAQ: ICCH], the publicly traded holding company that owns 100% of ICC. The outlook of these Credit Ratings (ratings) is stable. Both companies are domiciled in Rock Island, IL.
The ratings reflect ICC's balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
ICC's very strong balance sheet reflects the strongest level of risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio (BCAR), underwriting metrics that are either roughly in line with or lower than composite averages and overall surplus growth during the latest five-year period. Partially offsetting these positive factors is elevated common stock leverage and modest adverse loss reserve development on a two-year basis stemming from a handful of liability claims. Common stock leverage is influenced by a fund acquired in 2021 whose underlying assets are in fixed income; however, the asset is reported as equity. Nonetheless, the company is not an active trader, focusing on long-term investment strategies.
ICC's operating performance continues to perform adequately with pretax operating income reported in each of the past five years, primarily a result of consistent net investment income that has offset underwriting losses in most periods. The profile assessment reflects the company's niche focus serving the food and beverage industry. Finally, AM Best considers the ERM program as appropriate for the company's risk profile, with prudent reinsurance coverage purchased to insulate the balance sheet from shock weather losses.
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.
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