By a News Reporter-Staff News Editor at Insurance Weekly News -- A.M. Best has affirmed the financial strength rating (FSR) of A++ (Superior) and issuer credit ratings (ICR) of "aa+" of Philadelphia Indemnity Insurance Company (PIIC) and its affiliate, Tokio Marine Specialty Insurance Company (both headquartered in Bala Cynwyd, PA), which operate under a pooling agreement, collectively referred to as Philadelphia Insurance Companies (Philadelphia).
A.M. Best also has affirmed the FSR of A- (Excellent) and the ICRs of "a-" of Liberty American Insurance Company and Liberty American Select Insurance Company (LASIC) (both domiciled in Altamonte, FL), which operate under a pooling agreement, collectively referred to as Liberty American Insurance Group (Liberty American). The outlook for all ratings is stable.
Concurrently, A.M. Best has withdrawn the ratings for Liberty American due to management's request to no longer participate in A.M. Best's interactive ratings process. This request is due to the Liberty American companies being in run off and currently having no in-force policies.
All companies are subsidiaries of Tokio Marine North America Inc., which is an insurance holding company subsidiary of Tokio Marine & Nichido Fire Insurance Co., Ltd. (TMNF), a subsidiary of Tokio Marine Holdings, Inc. (TMHD) (both domiciled in Tokyo, Japan).
The ratings for Philadelphia reflect its superior operating performance, strong level of capitalization, solid liquidity and excellent market presence within the specialty commercial marketplace. The ratings also acknowledge the group's excellent operating cash flow, solid liquidity measures, well-developed enterprise risk management platform and strong management team. The ratings also recognize the strategic importance of the group to TMHD, as the group plays an important and strategic role in supporting TMHD's global expansion strategy.
A.M. Best believes that Philadelphia is well positioned at its current rating level. Negative rating actions could occur if Philadelphia's capitalization and/or operating performance fall markedly short of A.M. Best's expectations primarily as a result of any material increase in frequency and severity of catastrophe losses. The ratings also can be negatively impacted by any negative rating actions on TMNF and/or a change in support from or relationship with TMHD.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology. A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2014 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
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