The Demotech Company Classification System categorizes insurers into one of 11 categories based on an analysis of data reported by the companies to the National Association of Insurance Commissioners (NAIC). The 11 categories that comprise the system are Nationals, Near Nationals, Super Regionals, Regionals, State Specialists, Coverage Specialists, Strategic Subsidiaries, Risk Retention Groups, Surplus Lines Carriers, Reinsurers and Companies with less than $1 million in direct written premium.
To be categorized as a State Specialist, a carrier must be an individual, active company reporting data to the NAIC using the property/casualty annual statement format at Dec. 31, 2011. It must report at least $1 million in direct written premium at Dec. 31, 2011 with 90 percent or more in one state. Further, it cannot be a surplus lines company, risk retention group or reinsurance company.
In total, 768 companies were categorized as State Specialists for 2012. This is approximately 28.5 percent of the nearly 2,700 companies that reported data at Dec. 31, 2011. This group wrote nearly 15 percent of the industry’s direct written premium in 2011.
“State Specialists are often an independent agent’s most reliable and consistent market. These companies are dedicated to a geographic area, understand it and consistently strive to serve it. Demotech is pleased to provide State Specialists with the recognition they deserve,” said Joseph Petrelli, president of Demotech Inc., which also serves as Insurance Journal‘s official research partner.
As space limitations precluded an enumeration of each of the 768 State Specialists, the accompanying list includes the 310 State Specialists not affiliated with a group.
A full list of State Specialists is available by contacting Barry Koestler at: email@example.com.
Koestler II is the chief ratings officer of Demotech Inc., a financial analysis firm specializing in evaluating the financial stability of regional and specialty insurers. Since 1985, Demotech has served the insurance industry by assigning accurate, reliable and proven Financial Stability Ratings® (FSRs) for property/ casualty insurers and title underwriters. FSRs are a leading indicator of financial stability, providing an objective baseline of the future solvency of an insurer. Demotech’s philosophy is to review and evaluate insurers based on their area of focus and execution of their business model, rather than solely on financial size. This philosophy was the catalyst for the Demotech Company Classification System, which was developed and published in Insurance Journal, in order to stratify and categorize insurers into operational categories. Website: www.demotech.com.