AM Best has affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of "a-" of AmFirst Insurance Company (AmFirst) (Oklahoma City, OK) and its wholly owned subsidiaries, Monitor Life Insurance Company of New York (Monitor Life) (Utica, NY), AmFirst Life Insurance Company, I.I. (San Juan, Puerto Rico) and New Providence Life Insurance Company (New Providence Life) ( Nassau, Bahamas). Concurrently, AM Best has affirmed the FSR of B++ (Good) and the Long-Term ICR of "bbb+" of AmFirst’s subsidiary, AmFirst Specialty Insurance Company (AmFirst Specialty) (Ridgeland, MS). The outlook of these Credit Ratings (ratings) is stable.
The ratings of the AmFirst Holdings, Inc. group reflect the companies’ balance sheet strength, which AM Best categorizes as very strong, as well as their adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
These rating affirmations reflect the rating unit’s strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), and the operating entities maintaining solid liquidity and leverage measures. AmFirst’s flagship medical gap product (Premium Saver) and its dental association business continue to stabilize reported net earnings. With the COVID-19 pandemic issues affecting all health insurers and product lines, AM Best expects the measures taken by major medical and dental carriers to affect earnings in 2020. Most primary health insurers have waived testing fees and co-pays for treatment of COVID-19, which alleviates out-of-pocket expenditures for AmFirst’s GAP subscribers. With stay-at-home or shelter-in-place guidance affecting geographic areas where AmFirst operates, a projected utilization drop for both medical and dental subscribers in the second quarter and into the third quarter may favorably affect AmFirst’s quarterly and full year operating performance. Offsetting these favorable developments is AmFirst’s limited business profile due to a concentration of premium revenue in a number of states and a majority of its premium being derived from the gap and dental products.
The ratings also reflect AmFirst Specialty’s balance sheet, which AM Best categorizes as adequate, as well as its adequate operating performance, limited business profile and appropriate ERM. The ratings also benefit from the implicit and explicit support of its immediate parent, AmFirst Insurance Company, and its ultimate parent, AmFirst Holdings, Inc. (AHI).
AmFirst Specialty’s risk-adjusted capitalization, as measured by BCAR, is categorized as very strong, reflective of several capital contributions by its immediate parent. The balance sheet assessment of adequate, however, is reflective of its absolute surplus size and significant dependence on reinsurance and exposure to catastrophe risk. AM Best assesses AmFirst Specialty’s operating performance as adequate, largely based on its limited results as a newly formed entity. The business profile is assessed as limited based on its significant geographic and product line concentration. The company’s ERM practices are assessed as appropriate, with the process managed by its immediate parent. Rating enhancement is based on the implicit and explicit support AmFirst Specialty receives from its parent, in the form of common management and financial guaranty, as well as its level of integration into AmFirst Specialty’s overall operational capabilities.
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’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
Copyright © 2020 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
Senior Financial Analyst—L/H
+1 908 439 2200, ext. 5061
+1 908 439 2200, ext. 5725
Manager, Public Relations
+1 908 439 2200, ext. 5159
Director, Public Relations
+1 908 439 2200, ext. 5644