San Diego auto insurance

Ratings Roundup: Wawanesa, AmerInst, First Net

01.01.70

A.M. B est Co. has affirmed the financial strength rating (FSR) of ‘A+’ (Superior) and issuer credit rating (ICR) of “aa-” of The Wawanesa Mutual Insurance Company , which is based in Winnipeg, Manitoba. Best has also affirmed the FSR of ‘A’ (Excellent) and ICRs of “a” of Wawanesa’s wholly owned property/casualty subsidiary, San Diego-based Wawanesa General Insurance Company (WGIC) and its wholly owned life/health subsidiary, Manitoba-based Wawanesa Life Insurance Company . The outlook for all ratings is stable. Best concurrently withdrew the FSR of ‘A+’ (Superior) and ICR of “aa-” of The Wawanesa Mutual Insurance Company US Branch, based in San Diego, as it has been dissolved. The ratings and outlook of Wawanesa are reflective of its “superior risk-adjusted capital, balance sheet strength, good geographic diversification and market leadership position,” Best explained. “Wawanesa maintains a very large equity base, which continues to produce superior risk-adjusted capital results and balance sheet strengths. The company ranks in the top 10 within most major markets and is Canada’s largest mutual in terms of equity and premiums written.” Best added that Wawanesa’s “ranking among market leaders has been achieved through steady, modest growth attributed to its successful long-term relationships with brokers, which has helped the company maintain a strong regional presence. As partial offsetting factors Best cited Wawanesa’s “concentration in personal lines auto, intense competitive pricing pressure and an increasing trend of more frequent and severe storm losses across Canada. The company is experiencing intense pricing pressure on its largest premium segment auto, which is heavily regulated.” In addition Best observed that in 2011, Wawanesa’s results on property lines “have been challenged by a continuing pattern of more frequent and severe storm losses as well as losses from the Slave Lake wildfires.” However, Best indicated that despite these several challenges, it nonetheless anticipates that Wawanesa “will continue to maintain superior capital strength. Wawanesa’s ratings and outlook may come under negative pressure if an unfavorable earnings trend develops and its capital erodes. However, the company’s ratings could benefit from a favorable earnings trend that outperforms peers, while maintaining superior risk-adjusted capitalization.”

Source: Insurance Journal