AM Best has upgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb+”(Good) from “bbb” (Good) and affirmed the Financial Strength Rating (FSR) of B++ (Good) of Aventus Insurance Company (Aventus) (Fort Worth, TX). The outlook of the Long-Term ICR has been revised to stable from positive, while the outlook of the FSR is stable.
The Credit Ratings (ratings) reflect Aventus’ 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).
The upgrade of the Long-Term ICR is based on Aventus’ improved balance sheet strength in recent years as the result of sustained profitable operating results, which have been supplemented by stable investment returns. In addition, the company has reported generally favorable loss reserve development over the most recent 10 years. Although Aventus has high reinsurance dependence, it helps the company mitigate its exposure to weather-related losses. Additionally, its panel of reinsurers is high quality and diverse, which helps lessen the exposure risk.
Aventus’ operating results are adequate although they have displayed some volatility as the result of varying retentions on the reinsurance program. The limited business profile reflects its geographically concentrated position in Texas. The company’s business is produced and underwritten by Wellington Risk Insurance Agency, Inc., a managing general agent, which offers rate flexibility and broader product options.
Aventus benefits from an appropriate ERM program that supports the risk profile of the organization, and includes stress testing and risk analysis to determine investment allocation and reinsurance purchases.
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 Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
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