A.M. Best has assigned a Financial Strength Rating (FSR) of A- (Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” to Service American Indemnity Co., headquartered in Austin, Texas. The outlook assigned to the ratings is stable.
Concurrently, A.M. Best has affirmed the FSR of A- (Excellent) and the Long-Term ICR of “a-” of Service Lloyds Insurance Co. (Service Lloyds), also headquartered in Austin. The outlook of these ratings is stable.
The ratings were assigned following the acquisition of American Healthcare Indemnity Co. by Service Insurance Holdings Inc., the parent company of Service Lloyds, on March 15, 2018, at which time the company was renamed Service American Indemnity Co. (Service American).
The ratings reflect the execution of an inter-company pooling agreement that was effective July 1, 2018, under which Service American will assume a 10 percent participation in a pool led by Service Lloyds. A.M. Best expects Service American to benefit from the shared expertise, services and financial support of Service Lloyds.
In addition to the inter-company pooling agreement, Service American will also benefit from Service Lloyds’ balance sheet strength that is at the very strong level, its adequate operating performance, limited business profile and its appropriate enterprise risk management. Service Lloyds will benefit from the cost efficiencies it expects to achieve through this agreement and also from licenses held by Service American that will help to support its plans to expand geographically.
Traditionally, Service Lloyds has focused predominantly on workers’ compensation business.
Source: A.M. Best
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