AM Best revises the outlook to positive for Ardellis Insurance Ltd.
OLDWICK, New Jersey – (COMMERCIAL THREAD) –AM Best revised the outlook from stable to positive and confirmed Ardellis Insurance Ltd.’s financial strength rating of A- (excellent) and long-term issuer credit rating of “a-” (excellent). (Ardellis) (Bermuda).
These credit ratings (ratings) reflect the strength of Ardellis’ balance sheet, which AM Best considers to be very strong, as well as its adequate operational performance, limited business profile and appropriate enterprise risk management (ERM).
The ultimate parent company of Ardellis is UFP Industries, Inc. (UFP). Ardellis offers reimbursement coverage for workers compensation, medical loss stop, general liability, automobile liability and property to its parent company. In addition, Ardellis assumes exposure to medical losses from third parties.
The revised outlook to positive reflects Ardellis’ favorable operating performance, with loss and expense ratio measures outperforming the general P&C industry over several years. The favorable claims ratios are attributable to Ardellis’ underwriting expertise and a consistent approach to claims control and security practices. The low expense ratios reflect the low overhead costs of the business. About 40% of the company’s net written premiums currently come from its parent company and the remainder of the stop is medical losses from third parties. Ardellis has experienced rapid growth in its medical stop-loss third party activity in recent years; however, this growth has moderated more recently. The related activities and the activities of third parties are currently profitable.
AM Best expects Ardellis’ balance sheet strength to remain very strong, supported by the highest level of risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR). AM Best considers that the ERM framework and the company’s risk management capabilities are suited to its risk profile. Additionally, Ardellis benefits from being an integral part of the ERM framework of its ultimate parent company.
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