AM Best has maintained the under review with negative implications status for the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) of Stillwater Insurance Company (SIC) (Santa Barbara, CA) and its wholly owned subsidiary, Stillwater Property and Casualty Insurance Company (SPAC) (Jericho, NY). These companies are collectively known as Stillwater Insurance Group (Stillwater). Concurrently, AM Best has maintained the under review with negative implications status for the Long-Term ICR of “bbb-” (Good) of WT Holdings, Inc. (Memphis, TN). Stillwater is ultimately owned by WT Holdings, Inc. At the same time, AM Best has placed under review with negative implications the FSR of A- (Excellent) and the Long-Term ICR of “a-” (Excellent) of Evergreen National Indemnity Company (Evergreen) (Independence, OH), a separately rated subsidiary of Stillwater.
The ratings for Stillwater and WT Holdings, Inc. will remain under review with negative implications while management continues to explore capital management strategies and other options to increase overall risk-adjusted capitalization and strengthen balance sheet metrics at Stillwater. The proceeds from management’s capital initiatives will be used to recapitalize Stillwater and reduce the financial leverage at the holding company. In addition, AM Best has placed the ratings for Evergreen under review with negative implications on a stand-alone basis, Evergreen’s results have been substantially profitable and consistent. Evergreen’s combined ratio has averaged 83.5% for the past five years and the 2022 year ended with a combined ratio of 86.6%. The ratings are under review only as they relate to Stillwater’s 30% ownership of Evergreen. The ratings will remain under review until AM Best can fully analyze the impact of management's plans. If these actions do not sufficiently improve balance sheet metrics, overall risk-adjusted capitalization and reduce financial leverage at the holding company the ratings will most likely be downgraded.
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