AM Best assigns ratings for Essent companies

AM Best has assigned financial strength ratings of A (Excellent) to Essent Guaranty, Essent Guaranty of PA, and Essent Reinsurance. The outlooks assigned to these credit ratings are stable, and are effective as of September 5, 2018.

“We are very pleased to have been assigned an AM Best Financial Strength Rating of A (Excellent) pertaining to our primary operating subsidiaries,” said Mark Casale, chairman and chief executive officer. “AM Best’s Financial Strength Rating is a significant achievement for our franchise as it reflects our strong balance sheet, operating performance and risk management expertise. Additionally, the AM Best financial strength rating provides independent assessment and transparency for counterparties relying on our financial strength and the value of our mortgage insurance and reinsurance products offered across our platforms.”

AM Best also assigned a long-term issuer credit rating of “a” to Essent Guaranty, Essent Guaranty of PA, and Essent Reinsurance with outlooks that are stable. The Long-Term Issuer Credit Rating reflects AM Best’s view of an issuer/entity's ability to meet its ongoing financial obligations.

According to AM Best Essent’s risk-adjusted capital, as measured by the Best Capital Adequacy Ratio (BCAR), is currently at the strongest level on a stressed and unstressed basis. Essent’s operating performance is assessed as strong based on positive underwriting performance results as reflected in loss and combined ratios over the past five years.

In addition the rating agency said that Essent’s business profile is assessed as limited, as the company is a monoline (re)insurer. Essent’s overall enterprise risk management (ERM) assessment is appropriate, as the company employs a robust ERM framework and infrastructure embedded across the company.