A.M. Best Co. has allotted a financial strength rating ("FSR")
and issuer credit rating ("ICR") to Essentia Insurance Company
(Essentia), which was recently acquired by
). The rating agency provided an FSR of "A" and ICR of "a+" to
Essentia. Both the ratings carry a stable outlook.
The ratings reflect the impact of the acquisition of Essentia
by Markel and the support that the company receives from one of
its partners, Evanston Insurance Company, through a 100% whole
account quota share reinsurance agreement.
Post acquisition, Essentia Insurance Company will continue to
underwrite insurance solely for Hagerty Insurance Agency and
Hagerty Classic Marine Insurance Agency. Through Hagerty, a
popular classic vehicle insurance provider, Essentia provides
insurance for timeless quality vehicles like classic cars,
vintage boats, motorcycles and related automotive collectibles
worldwide and caters to the largest network of classic car
A.M Best stated that the ratings on Essentia might be revised
based on the ratings assigned to Evanston. It also stated
that the rating might be downgraded if the support from Markel
and Evanston to Essentia decreases.
Rating affirmations or upgrades from credit rating agencies play
an important part in retaining investor confidence in the stock
as well as maintaining the creditworthiness in the market. We
believe that the company's present score with the credit rating
agencies will help it write more business going forward.
In December 2012, Standard & Poor's Rating Services had
affirmed their long- term counterparty credit rating on Markel at
"BBB" with a stable outlook. The rating came on the back of the
intended acquisition of
Alterra Capital Holdings Limited
), the company's strong competitive position as well as its scale
in the insurance and reinsurance market. However, A.M. Best Co.
retained the ICR of 'a+' and FSR of 'A' on Markel. Concurrently,
it also retained the ICR of 'BBB' together with the debt ratings
Last month, Fitch ratings reaffirmed the Issuer Default Rating
The Travelers Companies Inc.
), a close competitor of Markel at "A+" as per Reuters. It also
maintained the senior unsecured notes at "A" and subordinated
notes at "BBB+". The IFS of the subsidiaries carried the rating
of "AA". All the ratings held a stable outlook. The rating
reflected Travelers' strong market position, consistent earnings
results and a robust balance sheet.
Markel currently carries a Zacks #3 Rank (Hold). Travelers
also shares the same Zacks Rank.
ALTERRA CAP HLD (ALTE): Free Stock Analysis
MARKEL CORP (MKL): Free Stock Analysis Report
TRAVELERS COS (TRV): Free Stock Analysis
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