Ratings Assigned To Legal Insurer
A.M. Best Co. has assigned a financial strength rating of A [Excellent] and issuer credit ratings of “a” to Bermuda’s Attorneys’ Liability Assurance Society Ltd. [ALAS Ltd] and its wholly-owned Vermont subsidiary, Attorneys’ Liability Assurance Society, Inc./A Risk Retention Group [ALAS, Inc.].
The outlook assigned to all ratings is stable.
The ratings for ALAS Ltd. and ALAS, Inc. reflect their excellent risk-adjusted capital positions, favorable operating performances and their long-term dedication to the legal professional liability market.
In addition, A.M. Best recognises the extensive loss prevention resources provided to the insured members, along with the group’s exceptional enterprise risk management program.
Partially offsetting these positive rating factors are the risks inherent within the legal professional liability insurance sector including price competition.
As a single line writer, the companies are exposed to a low frequency, high severity characteristic from their selected market niches.
These factors are somewhat mitigated by their long-term association with their members, diversification over multiple jurisdictions, extensive loss mitigation programs and their effective use of reinsurance.
The outlook is based on the organisation’s ability to maintain underwriting and claim success, along with continued management of its capital position.
ALAS, Inc. ratings are based on A.M. Best’s group rating methodology and take into consideration the role and strategic importance the risk retention group plays in the support provided to its members.
Performances by ALAS Ltd. and ALAS, Inc. that could lead to positive rating actions include, but are not limited to, extended favorable operating results with supportive policyholders’ surplus.
Items that could have an adverse affect on ALAS Ltd. and ALAS, Inc.’s current ratings include a significant change in the legal professional liability market dynamics, an unfavorable claim and underwriting experience for the companies, shifting policyholders’ surplus positions or extraordinary variations in reinsurance treaties.
