SGIC Insurance Company Receives AM Best Credit Rating

AMBest Rating SGIC Insurance Provider

LDWICK – MAY 21, 2018

A.M. Best has assigned a Financial Strength Rating (FSR) of B++ (Good) and a Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb” to Southern Guaranty Insurance Company (headquartered in Clearwater, FL) (Southern Guaranty), a newly formed U.S. insurer that is part of Premier Servicing, LLC. (Premier). The outlook assigned to these Credit Ratings (ratings) is stable.

The ratings reflect Southern Guaranty’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management.

Based on the business plan shared with A.M. Best, Southern Guaranty’s risk-adjusted capital, as measured by the Best’s Capital Adequacy Ratio (BCAR), is projected to be at the strongest level over the near term. The balance sheet assessment takes into consideration the company’s initial capitalization, projected conservative asset allocation and reinsurance agreements with highly rated carriers. While the level of risk-adjusted capitalization is projected to moderate over the medium term as the company achieves its growth plans, A.M. Best expects the ultimate owner to provide additional capital support if needed.

Furthermore, the ratings take into account the business plans of the company, its experienced management team, as well as the near-term earnings prospects to be derived from the existing partner relationships. Southern Guaranty’s overall operating performance is considered adequate, given the expected results over the near term. Additionally, Southern Guaranty’s business profile is viewed as limited due to the start-up nature of operations, lack of product diversification and risk exposure during the first few years of operations. In addition, ancillary health products the company plans to grow have become very competitive with many carriers entering or expanding into that segment.

The company’s ability to execute its business plan will be a key rating factor going forward. As such, A.M. Best will closely monitor Southern Guaranty to ensure that targeted results are attained.

This press release relates to Credit Ratings that have been published on A.M. 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 A.M. 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 A.M. Best press releases, please view Guide for Media – Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source.