AM Holding Company has announced the establishment of an A- rated (AM Best) Arizona-authorized domestic excess and surplus (E&S) lines carrier and accredited reinsurer based in Dallas, Texas, called AM Specialty Insurance Company, or ASIC.
The new entity joins AM RE Syndicate and AM Star Claims, the group’s other insurance subsidiaries, as the three firms operating under the AM Holding Company umbrella. This marks a significant milestone for the company, as it means the group can now write business using its own capacity as well as on behalf of foreign reinsurers. As such, the firm plans to write new programs from 1.1 2023, in addition to its current programs business with existing partners.
As rates continue to rise, ASIG sees the launch of the accredited reinsurer as an opportunity to take greater control over their capacity deployment. The company, although authorized in Arizona, plans to gain licensure across all 50 states as it transitions into a full-stack balance sheet carrier.
The company has received a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” (Excellent). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect ASIC’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.
“The ratings of ASIC reflect its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio, supported by a conservative investment portfolio. AM Best anticipates that ASIC’s level of risk-adjusted capitalization will remain at the strongest level throughout its initial five-year start-up period,” says AM Best.
“The ratings also reflect ASIC’s adequate operating performance, which is based upon a well-defined business plan and management’s prior track record. ASIC’s limited business profile reflects the risk associated with executing on its business strategy as a new E&S lines carrier.”
ASIC’s Chief Executive Officer (CEO), Shevawn Barder, commented: “We are delighted to announce what we see as a massive landmark for the company. In addition to providing access to reinsurance capacity, we will also be able to offer innovative hybrid fronting solutions and risk sharing to our partners.”
“In many ways ASIC is a natural extension of our existing model, as we will be able to retain a slice of our existing portfolio, which has been very profitable. The goal of the group has always been to write high-quality business – we’ve done that successfully through AM RE via a risk-transfer model, and now we’re poised to do it all again while retaining some of the risk.”