OLDWICK, N.J.--(BUSINESS WIRE)--
A.M. Best Co. has upgraded the financial strength rating (FSR) to
A (Excellent) from A- (Excellent) and issuer credit ratings (ICR) to “a”
from “a-” of PICA Groupand its member, PodiatryInsurance
Company of America (PICA) (Springfield, IL). A.M. Best also has
upgraded the FSR to A- (Excellent) from B++ (Good) and ICR to “a-” from
“bbb+” of ProAssurance National Capital Insurance Company
(ProAssurance National) (District of Columbia).
Concurrently, A.M. Best has affirmed FSR of A (Excellent) and ICRs of
“a” of ProAssurance Group (ProAssurance) and its group rated
members. A.M. Best also has affirmed the ICR of “bbb” of ProAssurance’s
parent holding company, ProAssurance Corporation (PRA)
(Birmingham, AL) [NYSE: PRA]. In addition, A.M. Best has assigned
indicative debt ratings of “bbb” to senior unsecured debt, “bbb-” to
subordinated debt and “bb+” to preferred stock, which may be issued
under PRA’s recently filed and approved shelf registration statement. If
ProAssurance moves forward with the issuance of the debt or sale of
securities the company says it would use the net proceeds for general
corporate purposes. The outlook for all the above ratings is stable.
At the same time, A.M. Best has revised the outlook to positive from
stable and affirmed the FSR of A- (Excellent) and ICR of “a-” of ProAssurance
Wisconsin Insurance Company (ProAssurance Wisconsin) (Madison, WI).
Additionally, A.M. Best has revised the outlook to negative from stable
and affirmed the FSR of A- (Excellent) and ICR of “a-” of PACO
Assurance Company, Inc. (PACO) (Springfield, IL). (See below for a
detailed listing of the companies.)
The affirmation of the ratings for ProAssurance is based upon its
excellent risk-adjusted capitalization, strong operating performance,
solid reserving history and robust business position within the medical
professional liability insurance sector. The ratings also acknowledge
the group’s aggressive claim defense, risk management expertise,
geographical diversification and localized knowledge within the many
jurisdictions in which it operates.
Partially offsetting these strengths are ProAssurance’s inherent market
risks associated with the medical professional liability sector. These
risks center around price competition, loss costs, legislative (tort)
reform and regulatory challenges.
Additionally, ProAssurance’s ratings consider the financial flexibility
that PRA provides to the operating companies. PRA’s financial leverage
(total debt/total capital) was a modest 2.9% at year-end 2009; interest
coverage remains extremely strong, and it currently holds a substantial
amount of cash and short-term investments outside of its insurance
subsidiaries.
The upgrading of PICA’s ratings is based upon its supportive
capitalization, consistently favorable operating performance and its
leadership position as a provider of professional liability insurance to
podiatrists throughout the United States. PICA’s ratings also are
enhanced by the explicit and implicit support of PRA following its
acquisition of PICA in April 2009.
The rating upgrades of ProAssurance National are based upon the
company’s excellent risk-adjusted capitalization, its leadership
position in providing medical professional liability insurance in its
sole territory of the District of Columbia, and the company’s much
improved underwriting performance since it was acquired by PRA in 2005.
The FSR of A (Excellent) and ICRs of “a” have been affirmed for ProAssurance
Group
and its following members:
- ProAssurance Casualty Company
- ProAssurance Indemnity Company, Inc.
- ProAssurance Specialty Insurance Company, Inc.
For Best’s Credit Ratings, an overview of the rating process and rating
methodologies, please visit www.ambest.com/ratings.
The principal methodologies used in determining these ratings, including
any additional methodologies and factors that may have been considered,
can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is a global full-service credit
rating organization dedicated to serving the financial and health care
service industries, including insurance companies, banks, hospitals and
health care system providers. For more information, visit www.ambest.com.
Source: A.M. Best Co.
Contact:
A.M. Best Co.
Analysts
Greg Williams
(908)
439-2200, ext. 5815
greg.williams@ambest.com
or
Henry
Witmer
(908) 439-2200, ext. 5097
henry.witmer@ambest.com
or
Public
Relations
Rachelle Morrow
(908) 439-2200, ext.
5378
rachelle.morrow@ambest.com
or
Jim
Peavy
(908) 439-2200, ext. 5644
james.peavy@ambest.com