AM Best announced that is has downgraded and withdrawn the financial strength ratings of CSE Insurance Group’s Civil Service Employees Insurance Company and CSE Safeguard Insurance Company, describing the group as being “effectively placed into runoff.”
In a media statement, the rating agency said it lowered the two insurers’ financial strength ratings to B (Fair) from B+ (Good), and long-term issuer ratings to “bb” (Fair) from “bbb-” (Good).
The outlook is of the ratings negative.
Concurrently, AM Best has withdrawn the ratings as CSE Group has requested to no longer participate in AM Best’s interactive rating process.
“Following CSE Group’s decision to exit the market and no longer write new business as of October 9, 2023, as well as non-renew existing business over the next 12 months, the group’s business profile is assessed as very limited based on material changes in business strategy, product offerings and earnings capacity,” Best said.
AM Best assesses the group’s balance sheet strength as adequate, also noting the group’s marginal operating performance and marginal enterprise risk management.
Although the group currently maintains the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), policyholders surplus has continued to decline, down 25 percent through the first six months of 2023, due to significant underwriting losses, Best said.
Source: AM Best