AM Best Downgrades Credit Ratings of Southern States Insurance Exchange
OLDWICK, N.J.--(BUSINESS WIRE)--May 22, 2025--
AM Best has downgraded the Financial Strength Rating to A- (Excellent) from A (Excellent) and the Long-Term Issuer Credit Rating to 'a-' (Excellent) from 'a' (Excellent) of Southern States Insurance Exchange (SSIE) (Richmond, VA). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect SSIE's balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
The rating downgrades reflect the change in the company's operating performance assessment to adequate from strong following continued volatility in underwriting and operating results in recent years, due primarily to a culmination of overall claims inflation, large losses, higher reinsurance costs and rate adequacy challenges given the aforementioned. The company also suffered higher-than-normal losses from weather-related events in 2023 and 2024 and posted adverse prior-year reserve development in 2024. Weaker-than-expected underwriting results from its workers' compensation line of business, added to the deterioration in SSIE's key profitability ratios since 2021.
Beginning in 2023, several corrective actions were taken to restore profitability to pre-2023 levels via improved pricing, risk selection, enhanced customer safety and loss control initiatives. Actions taken by management in 2023 and 2024 are expected to stabilize underwriting and operating results over time.
SSIE's balance sheet strength is supported by its strongest level of risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio (BCAR), and conservative underwriting and loss reserve leverage measures. The business profile assessment reflects the company's niche market in agricultural industry and geographic concentration in mid-Atlantic and Southeast U.S. states. ERM remains appropriate and in line with its risk profile.
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'sRecent Rating Activityweb page. For additional information regarding the use and limitations of Credit Rating opinions, please viewGuide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please viewGuide to Proper Use of Best's Ratings & Assessments.Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
View source version on businesswire.com:https://www.businesswire.com/news/home/20250522976323/en/
CONTACT: Fred Eslami
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Daniel Ryan
Senior Director
+1 908 882 2290
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Christopher Sharkey
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Al Slavin
Senior Public Relations Specialist
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KEYWORD: EUROPE UNITED STATES NORTH AMERICA NEW JERSEY
INDUSTRY KEYWORD: INSURANCE PROFESSIONAL SERVICES
SOURCE: AM Best
Copyright Business Wire 2025.
PUB: 05/22/2025 10:21 AM/DISC: 05/22/2025 10:21 AM
http://www.businesswire.com/news/home/20250522976323/en
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