OLDWICK, N.J.–(BUSINESS WIRE)–AM Best has upgraded the Long-Term Issuer Credit Ratings
(Long-Term ICR) to “a+” from “a” and affirmed the Financial Strength
Rating (FSR) of A (Excellent) of the subsidiaries of the parent holding
company, The Hanover Insurance Group, Inc. (THG) [NYSE: THG],
collectively referred to as Hanover Insurance Group Property and
Casualty Companies (The Hanover). Additionally, AM Best has upgraded the
Long-Term ICR to “bbb+” from “bbb” and all the Long-Term Issue Credit
Ratings (Long-Term IR) of THG. The outlook of these Credit Ratings
(ratings) remains stable. All above named companies are headquartered in
Worcester, MA. (See below for a detailed listing of the companies and
ratings.)
The ratings reflect The Hanover’s balance sheet strength, which AM Best
categorizes as strongest, as well as its adequate operating performance,
favorable business profile and appropriate enterprise risk management.
The upgrade of the Long-Term ICRs reflect an improvement in AM Best’s
assessment of the group’s business profile. Based on net premiums
written, The Hanover ranks among the top 25 property/casualty
organizations in the United States, while continuing to execute its
business strategy of profitable growth and increasing market
penetration. The group’s product range includes personal lines, core
commercial offerings and specialty coverages, with business expansion
supported by strong relationships with its independent agency partners.
Additionally, The Hanover’s ratings reflect the group’s strongest
risk-adjusted capitalization, as measured by Best’s Capital Adequacy
Ratio (BCAR). The ratings also reflect the group’s exposure management
and re-underwriting, which have improved geographic and product
diversification materially, resulting in profitability and earnings
stability. Lastly, the subsidiaries of THG benefit from its moderate
financial leverage and financial flexibility.
Partially offsetting these positive rating factors are The Hanover’s
comparatively high underwriting leverage and above-average expense
position. However, over recent years, improved scale and enhanced
operating efficiencies have driven a meaningful decline in the expense
ratio.
The Long-Term ICRs have been upgraded to “a+” from “a”, and the FSR of A
(Excellent) has been affirmed for the following subsidiaries of The
Hanover Insurance Group, Inc.:
- AIX Specialty Insurance Company
- Allmerica Financial Alliance Insurance Company
- Allmerica Financial Benefit Insurance Company
- Campmed Casualty & Indemnity Company, Inc.
- Citizens Insurance Company of America
- Citizens Insurance Company of Ohio
- Citizens Insurance Company of the Midwest
- Citizens Insurance Company of Illinois
- The Hanover American Insurance Company
- The Hanover Atlantic Insurance Company, Ltd.
- The Hanover Insurance Company
-
The Hanover Casualty Company (formerly known as Hanover Lloyd’s
Insurance Company) - The Hanover New Jersey Insurance Company
- Massachusetts Bay Insurance Company
- NOVA Casualty Company
- Verlan Fire Insurance Company
The Long-Term ICR has been upgraded to “bbb+” from “bbb” with a stable
outlook for The Hanover Insurance Group, Inc.
The following Long-Term IRs have been upgraded with a stable outlook:
The Hanover Insurance Group, Inc.—
— to “bbb+” from “bbb” on
$199.5 million 7.625% senior unsecured debentures, due 2025 (of which
$62.6 million remains outstanding)
— to “bbb+” from “bbb” on
$375.0 million 4.5% senior unsecured fixed rate notes, due 2026
—
to “bbb-” from “bb+” on $166 million 8.207% subordinated deferrable
debentures, due 2027 (of which $50.1 million remains outstanding)
—
to “bbb-” from “bb+” on $175 million 6.350% subordinated deferrable
debentures, due 2053
The following indicative Long-Term IRs under the shelf registration have
been upgraded with a stable outlook:
The Hanover Insurance Group, Inc.—
— to “bbb+” from “bbb” on
senior unsecured debt
— to “bbb-” from “bb+” on subordinated debt
—
to “bbb-” from “bb+” on preferred stock
This press release relates to Credit Ratings that have been published
on AM Best’s website. For all rating information relating to the release
and pertinent disclosures, including details of the office responsible
for issuing each of the individual ratings referenced in this release,
please see AM Best’s Recent
Rating Activity web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view Understanding
Best’s Credit Ratings. For information on the proper media
use of Best’s Credit Ratings and AM Best press releases, please view Guide
for Media – Proper Use of Best’s Credit Ratings and AM Best Rating
Action Press Releases.
AM Best is a global rating agency and information provider with a
unique focus on the insurance industry. Visit www.ambest.com
for more information.
Copyright © 2019 by A.M. Best Rating Services, Inc. and/or its
affiliates. ALL RIGHTS RESERVED.
Contacts
Michael T. Venezia
Senior Financial Analyst
+1
908 439 2200, ext. 5034
[email protected]
Jacqalene
Lentz, CPA
Director
+1 908 439 2200, ext. 5762
[email protected]
Christopher
Sharkey
Manager, Public Relations
+1 908 439
2200, ext. 5159
[email protected]
Jim
Peavy
Director, Public Relations
+1 908 439
2200, ext. 5644
[email protected]
