Rating agency AM Best has placed Safepoint Insurance Company under review with negative implications, which reflects its near-term capital management plan for its holding company, Safepoint Holdings.
Safepoint currently holds the Financial Strength Rating of B- (Fair) and the Long-Term Issuer Credit Rating of “bb-” (Fair).
The holding company’s unfavourable pressure has increased due to equity erosion and outstanding debt, exceeding AM Best’s threshold for what is considered a neutral level of financial leverage.
Safepoint’s capital management plan calls for an improved financial position for Safepoint Holdings, which is expected to alleviate this pressure.
Should these plans not materialise within the expected timeline, negative rating action may follow.
The ratings will remain under review until management finalises and executes this plan and AM Best evaluates the impact on the overall organisation.
