AM Best lowers the credit rating of the issuer of Chautauqua Patrons Insurance Company

OLDWICK, New Jersey – (COMMERCIAL THREAD) –AM Best downgraded the issuer’s long-term credit rating (long-term ICR) to “bbb” (good) from “bbb +” (good) and confirmed the financial strength rating (FSR) of B ++ (good) of Chautauqua Patrons Insurance Company (Chautauqua) (Jamestown, New York). The outlook for the long-term ICR has been revised from negative to stable, while the outlook for the FSR is stable.

These credit ratings (ratings) reflect the strength of Chautauqua’s balance sheet, which AM Best considers very strong, as well as its marginal operational performance, limited business profile and marginal enterprise risk management (ERM).

The degradation of Chautauqua’s long-term ICR reflects AM Best’s concern about the effectiveness of the company’s ERM program and current risk mitigation strategies, given its demonstrated tendency towards earnings volatility. long-term operation. Chautauqua faces several challenges, including the successful implementation of its new business model, growth initiatives and expectations of future profitability. Following the review of Chautauqua’s risk management framework, AM Best expects that the company’s use of strong corporate governance practices will help it better manage risk with less volatility in the long run. term.

Chautauqua’s balance sheet strength assessment remains at a very high level, supported by its highest level of risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR), a lever of Moderate underwriting and strong liquidity measures. AM Best considers that the operational performance of Chautauqua is marginal, in large part due to the volatility of the technical results which is partially offset by the net investment income. Limited business profile reflects the company’s geographic and product concentration, as a real estate writer primarily in New York State, which exposes operations to weather events, as well as regulatory, legal and legislative issues. .

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