A.M. Best has completed its evaluation of Los Angeles-based Topa Insurance Company and affirmed a rating of “A-” (Excellent) with a stable outlook.
The rating is based on the consolidation of Topa Insurance Company and its wholly-owned, separately rated subsidiary, Dorchester Insurance Company Ltd. The rating reflects the group’s solid capitalization and diversified product offerings. Based on the group’s solid capitalization and improved earnings expectations, A.M. Best views the rating outlook as stable.
The group’s solid capitalization is derived from management’s prudent loss reserving practices, moderate investment leverage and catastrophe mitigation strategies that insulate earnings and surplus from shock loss volatility. The rating also reflects the close monitoring of aggregate property exposures and controlled distribution platform. In addition, management has implemented a number of strategic initiatives in recent years to improve profitability that have included rate increases, tightened underwriting guidelines, reduced expenses levels, new technology systems, and the discontinuance of unprofitable agencies and lines of business. Through its various operating subsidiaries and multiple revenue streams, the group’s parent, Topa Equities, Ltd., provides the group with operational and financial support.
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